[Senate Hearing 119-10]
[From the U.S. Government Publishing Office]
S. Hrg. 119-10
PERSPECTIVES FROM THE FIELD:
FARMER AND RANCHER VIEWS ON THE AGRICULTURAL ECONOMY, PART 1
=======================================================================
HEARING
before the
COMMITTEE ON AGRICULTURE,
NUTRITION, AND FORESTRY
UNITED STATES SENATE
ONE HUNDRED NINETEENTH CONGRESS
FIRST SESSION
__________
February 5, 2025
__________
Printed for the use of the
Committee on Agriculture, Nutrition, and Forestry
GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT
Available on http://www.govinfo.gov/
_______
U.S. GOVERNMENT PUBLISHING OFFICE
58-674 PDF WASHINGTON : 2025
COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY
JOHN BOOZMAN, Arkansas, Chairman
MITCH McCONNELL, Kentucky AMY KLOBUCHAR, Minnesota
JOHN HOEVEN, North Dakota MICHAEL F. BENNET, Colorado
JONI ERNST, Iowa TINA SMITH, Minnesota
CINDY HYDE-SMITH, Mississippi RICHARD J. DURBIN, Illinois
ROGER MARSHALL, Kansas CORY BOOKER, New Jersey
TOMMY TUBERVILLE, Alabama BEN RAY LUJAN, New Mexico
JAMES C. JUSTICE, West Virginia RAPHAEL WARNOCK, Georgia
CHARLES GRASSLEY, Iowa PETER WELCH, Vermont
JOHN THUNE, South Dakota JOHN FETTERMAN, Pennsylvania
DEB FISCHER, Nebraska ADAM SCHIFF, California
JERRY MORAN, Kansas ELISSA SLOTKIN, Michigan
Fitzhugh Elder IV, Majority Staff Director
Caleb Crosswhite, Majority Chief Counsel
Jessica L. Williams, Chief Clerk
Lauren Santabar, Minority Staff Director
Chu-Yuan Hwang, Minority Chief Counsel
C O N T E N T S
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Wednesday, February 5, 2025
Page
Hearing:
Perspectives From the Field: Farmer and Rancher Views on the
Agricultural Economy, Part 1................................... 1
----------
STATEMENTS PRESENTED BY SENATORS
Boozman, Hon. John, U.S. Senator from the State of Arkansas...... 1
Klobuchar, Hon. Amy, U.S. Senator from the State of Minnesota.... 2
WITNESSES
Panel I
Duvall, Zippy, President, American Farm Bureau Federation, Greene
County, Georgia................................................ 5
Larew, Rob, President, National Farmers Union, Greenville, West
Virginia....................................................... 6
Panel II
Reed, Nathan, Board of Directors, National Cotton Council,
Marianna, Arkansas............................................. 35
Hartman Jr., Kenneth, President, National Corn Growers
Association, Waterloo, Illinois................................ 36
Felty, Keeff, President, National Association of Wheat Growers,
Altus, Oklahoma................................................ 38
Engelstad, Chris, President, National Barley Growers Association,
Fertile, Minnesota............................................. 39
France, Amy, Chair, National Sorghum Producers, Scott City,
Kansas......................................................... 40
Gackle, Josh, Chairman, American Soybean Association, Kulm, North
Dakota......................................................... 42
Moore, Garrett, Member, U.S. Peanut Federation, Chancellor,
Alabama........................................................ 43
Deal, Tim, Vice President, American Sugarbeet Growers
Association, American Sugar Alliance, Doran, Minnesota......... 45
James, Jennifer, Board of Directors, USA Rice, Newport, Arkansas. 46
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APPENDIX
Prepared Statements:
Duvall, Zippy................................................ 58
Larew, Rob................................................... 65
Reed, Nathan................................................. 75
Hartman, Jr., Kenneth........................................ 80
Felty, Keeff................................................. 95
Engelstad, Chris............................................. 108
France, Amy.................................................. 112
Gackle, Josh................................................. 118
Moore, Garrett............................................... 127
Deal, Tim.................................................... 140
James, Jennifer.............................................. 149
Document(s) Submitted for the Record:
Klobuchar, Hon. Amy:
AFBF Cautions Against Letter to President of the United
States..................................................... 158
AFBF Cautions Against Tariffs on Top Trading Partners Press
Release.................................................... 159
National Farmers Union Urges President to Consider Tariffs'
Impact on Farmers Press Release............................ 160
Question and Answer:
Duvall, Zippy:
Written response to questions from Hon. Amy Klobuchar........ 162
Written response to questions from Hon. Joni Ernst........... 162
Written response to questions from Hon. Tommy Tuberville..... 163
Written response to questions from Hon. Raphael Warnock...... 164
Engelstad, Chris:
Written response to questions from Hon. Amy Klobuchar........ 166
Felty, Keeff:
Written response to questions from Hon. Amy Klobuchar........ 167
Gackle, Josh:
Written response to questions from Hon. Joni Ernst........... 168
Hartman, Kenneth:
Written response to questions from Hon. Amy Klobuchar........ 169
Written response to questions from Hon. Joni Ernst........... 170
Written response to questions from Hon. Tina Smith........... 170
Larew, Rob:
Written response to questions from Hon. Amy Klobuchar........ 172
Written response to questions from Hon. Joni Ernst........... 172
Written response to questions from Hon. Ben Ray Lujan........ 173
Moore, Garret:
Written response to questions from Hon. Amy Klobuchar........ 174
Written response to questions from Hon. Tommy Tuberville..... 174
Written response to questions from Hon. Raphael Warnock...... 175
Reed, Nathan:
Written response to questions from Hon. Amy Klobuchar........ 176
Written response to questions from Hon. Tommy Tuberville..... 176
PERSPECTIVES FROM THE FIELD: FARMER AND RANCHER VIEWS ON THE
AGRICULTURAL ECONOMY, PART 1
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WEDNESDAY, FEBRUARY 5, 2025
U.S. Senate
Committee on Agriculture, Nutrition, and Forestry
Washington, DC.
The Committee met, pursuant to notice, at 10:36 a.m., in
Room SD-106, Dirksen Senate Office Building, Hon. John Boozman,
Chairman of the Committee, presiding.
Present: Senators Boozman [presiding], McConnell, Hoeven,
Ernst, Hyde-Smith, Marshall, Tuberville, Justice, Grassley,
Moran, Klobuchar, Bennet, Smith, Durbin, Booker, Ljuan,
Warnock, Welch, and Schiff.
STATEMENT OF HON. JOHN BOOZMAN, U.S. SENATOR FROM THE STATE OF
ARKANSAS, CHAIRMAN, U.S. COMMITTEE ON AGRICULTURE, NUTRITION,
AND FORESTRY
Chairman Boozman. I am delighted now to call the hearing to
order, and I would like to thank our witnesses for being here
today. Thank you for leaving your farms and families to travel
to Washington to share your experiences with us. As a proud
Arkansan, I am delighted to have Nathan Reed and Jennifer James
here on today's second panel.
This hearing is the first in our series of the Committee
that we will be holding on the current state of America's rural
economy from the perspective of our farmers, ranchers, and
rural leaders. These hearings are intended to help inform our
decisions as we draft a new farm bill and to ensure we are
putting forward policies that will help current and future
generations of farm families survive and ultimately thrive in a
very unpredictable world.
Every Member of this Committee has heard directly from
farmers in their States about the current difficulties that
they face. I have been blessed to join Members of the Committee
to be part of some of these conversations, and I look forward
to continuing the dialog.
High interest rates, elevated production cost, and
depressed commodity prices coupled with a frayed safety net
worn out over time have left many producers exposed to
financial ruin. Since 2022, producers have lost more than $50
billion in net income and net farm income is forecast to
continue to decline. Farmers are experiencing a scenario where
there is no room for error. Farm families are looking for the
next generation and trying to determine if this career, that
requires more sacrifice than most careers, is viable. I fear
that across the country we are at risk of losing untold numbers
of family farms.
Recently, the Agriculture and Food Policy Center of Texas
A&M University stated that, ``In 42 years that the food center
has been projecting farm financial performance, the most recent
crop outlook for the representative farms is the worst in terms
of the number of farms in each of the four commodity types-feed
grains, cotton, rice, and wheat-that are not currently expected
to have a positive cash-flow over the next five years.''
My highest priority for the next farm bill is to improve
the Farm Safety Net, whereby every farmer, in every region,
will have access to modernized risk management tools regardless
of the commodity that they grow. If we fail to modernize the
safety net, agriculture will see further consolidation as farm
families leave the business and the ripple effects to our
country will be truly profound.
The task before us is great. I look forward to hearing from
today's witnesses, and I now turn to Ranking Member Klobuchar
for opening comments.
STATEMENT OF HON. AMY KLOBUCHAR, U.S. SENATOR FROM THE STATE OF
MINNESOTTA
Senator Klobuchar. Well, thank you very much, Senator
Boozman, thank you to our incredible group of witnesses,
including some from the State of Minnesota and I especially
want to welcome Mr. Duvall and Mr. Larew. Most importantly,
your street creds are, you have both been to Minnesota's Farm
Fest, so we thank you for that.
I join the Chairman in appreciating the work this Committee
has done so far, and we have gotten to a good, strong
bipartisan support our nation's farmers to continue to produce
the world's safest and most abundant food supply. We know that
our farmers take on significant risks and operate on razor thin
margins to feed America and the world and it is our job to make
sure that continues.
I have heard consistently from Minnesota farmers that they
need certainty, and part of that certainty, of course, as we
all know, is getting a farm bill in place. There are changes we
need to make from the last farm bill to make it even better and
our Committee has an opportunity at a time when we have got
high input costs, where we have got avian flu, we have an
opportunity to pass a bipartisan farm bill and deliver that
certainty.
A strong farm bill, of course, requires a coalition of
farm, food, research, rural nutrition and conservation
interests, things we care deeply about. Farmers depend on all
parts of the farm bill from energy programs that create new
markets to research to dealing with emerging threats. We are
ready to work with all of our colleagues to get that done.
I do want to take a moment to talk about what happened this
past week when we are talking about certainty. I am very
concerned about the administration's first moves on tariffs.
While I support targeted tariffs like many on this Committee, I
have serious concerns about sweeping across the board tariffs
that threaten our farmers livelihoods.
Both the American Farm Bureau and the National Farmers
Union have expressed concerns about the tariffs and how they
could lead to financial hardships for U.S. farmers and
ranchers, and of course create higher prices for consumers.
Across the board, tariffs open American farmers to retaliatory
tariffs, and we have seen this before.
As I said in my opening at our nomination hearing for
Brooke Rollins, what our farmers want is a fair trade and not
aid. They want trade, not aid, and this would be a major
problem, if we look at the results of this.
The decision to impose 25 percent tariffs, which as we know
is now on pause for a short period of time on Canada and
Mexico, even if delayed 30 days, could increase cost for inputs
like fertilizer just as they are trying to plan for an upcoming
season. A terrifying Canadian potash could increase fertilizer
cost by as much as a $1.70 an acre for corn and a $1.42 an acre
for soybeans.
American farmers have worked for decades thanks to these
two gentlemen and many behind them to improve their
international market access. We have been able to find common
ground in this Committee on this issue, such as the market
promotion funding and the recent initiative launched by USDA.
We need to build on, not roll back, this progress.
A strong Farm Safety Net, as pointed out by Senator
Boozman, include Title I programs and crop insurance, and they
are our farmers' most effective tools in managing uncertainty.
Right now, unfortunately, with some of the confusion over this
funding freeze, and the OMB memo that was then rescinded in 24
hours, but then other statements from the White House, we have
heard from farmers unable to access these critical resources.
Last Congress, Senator Thune and I worked on the Crop
Insurance for Future Farmers Act, to give beginning and veteran
farmers more affordable crop insurance protection and this
effective tool's important, and we do not want to take it away
in the middle of what I consider chaos.
Extreme weather patterns make the need for a strong safety
net, even more urgent, and the effects of climate change.
Minnesota farmers have recorded nearly one billion in crop
insurance indemnities for 2024 losses due to extreme weather,
including droughts and floods. To address these challenges,
Congress added significant funding to USDA's popular voluntary
conservation programs. USDA also launched a commodities
initiative to provide new market opportunities for our nation's
farmers. The future of these programs is uncertain, and I think
it is very important to see this. Many of us may have different
political lenses, but to see it from an agriculture standpoint.
We have heard from farmers who have purchased tens of
thousands of dollars in cover crop seed only to receive notice
that disbursements for these costs are paused. As many of my
colleagues have expressed, and you will hear from today, we
remain deeply troubled by the administration's pause on
conservation support for farmers, and we would like to make
sure that we reduce this chaos and make it easier for our
farmers to do their good work.
This Committee has always provided a venue for coming
together, Democrats and Republicans, to support our farmers in
rural America. I know, from our personal friendship, that
Chairman Boozman and I and in our Committee hearing so far,
want that to continue in a very strong way. We are excited
about the Committee and the incredible Members on this
Committee, and we want to do right by our farmers and the
people of this country that depend on them.
I look forward to hearing from the testimony of the
witnesses. Thank you.
Chairman Boozman. Thank you, Senator Klobuchar. Very well
said. We will now introduce the first panel of witnesses. And,
Senator Warnock.
Senator Warnock. Thank you so very much, Mr. Chairman. It
is my pleasure to introduce Mr. Zippy Duvall. He is the
President of the American Farm Bureau Federation, where he has
served as President since 2016. Mr. Duvall is a third-
generation farmer from Georgia, Greensboro, where he and his
son operate a beef cow herd, they raise broiler chickens and
they grow their own hay, all while maintaining Georgia farmland
that has been in their family for more than 90 years. Farming
is in his bloodstream.
Mr. Duvall has been a consistent and reliable leader,
championing Georgia's agriculture community through the ups and
downs of an often-unpredictable business. Zippy, as we call
him, has seen it all, including responding to natural
disasters, supply chain disruptions, and inflationary pressures
with the focus of making sure farmers and ranchers in Georgia
and across the country have the support that they need from all
of us on this panel and elected officials across Georgia and
across our country.
Prior to being elected American Farm Bureau President, he
was President of the Georgia Farm Bureau and served on the
American Farm Bureau Board of Directors. Thank you Zippy for
being with us today to speak on behalf of farmers from Georgia
and across the country. We know you do hard work with slim
margins and we are grateful. I often say that farmers are an
answer to a prayer, give us this day our daily bread. It is an
honor to represent Georgians like you and I look forward to
hearing from you today, as I am sure all of my colleagues.
Chairman Boozman. Senator Justice.
Senator Justice. Thank you so much, it is quite an honor
for me to introduce Rob Larew. I have got to tell you just
this, and this is just so simple, but years ago, this gentleman
and everything, was buying wet corn from us. He has a great
farm in Greenville, West Virginia. Get this now, that farm has
been in their family, is that correct, since 1798. It is
amazing, absolutely amazing.
As this man graduated from Virginia Tech. He has served the
last five years as the President of the National Farmers Union,
which represents 230,000 family farmers and ranchers across
rural America. He is a man of many, many, many talents, and
Rob, we had a past acquaintance and now a new acquaintance and
everything, but I thank you so much for all you have done. I
cherish all the great stuff that your family's done. Get this,
this is all within a rocks throw of the farm that where we
started.
We started our farming operation in 1977 and grew it to a
point where we were absolutely--I think the largest cash grain
farmers east of the Mississippi River. We started with almost
nothing and grew and grew and grew. With all that being said,
this man was a part of my life and I am privileged to say I was
a part of his life as well. He is a real deal.
Rob, we thank you so much for being here. We are really
interested in what you have to say today and I promise you I
will really pay attention. Thank you so much,
Chairman Boozman. That is a good promise. You cannot beat
that.
[Laughter.]
Senator Klobuchar. Something for all of us to remember.
Chairman Boozman. We are going to go a little bit out of
sequence in the sense that Senator Durbin's here and is going
to introduce Mr. Hartman. There is just so much going on right
now. You are going to have a lot of people going back and
forth. Senator Durbin.
Senator Durbin. Mr. Chairman, thank you for accommodating
me. I may not be here for the formal introduction of the second
panel. I just want to tell you, my friend Kenny Hartman used to
be the President of the Illinois Corn Growers, he has been
promoted, he is now the President of the National Corn Growers
Association from Waterloo, Illinois. Welcome Kenny, thanks for
being here today.
Chairman Boozman. Very good. Mr. Duvall, you are
recognized.
STATEMENT OF MR. ZIPPY DUVALL, PRESIDENT, AMERICAN FARM BUREAU
FEDERATION, GREENE COUNTY, GEORGIA
Mr. Duvall. Thank you, Senator, and Chairman Boozman and
Ranking Member Klobuchar and other distinguished guests,
especially my Senator from Georgia and thank you for that
introduction. I am focused on Jesus today.
Also, I want to thank Rob here. Rob and I have become good
friends over the years and worked together constantly making
sure that farmers' voices are being heard. I am Zippy Duvall,
President of American Farm Bureau, and my son and I still do
farm in Georgia. I spent 30 years dairying. All of you know
what a dairyman's life is like. I thought I would never find a
job that was more difficult than in dairy, but I might have
found it.
The farm families across the country are grateful for you,
recognizing incredible hard times across agricultural economy.
When you included a much-needed economic assistance and
emergency aid for communities that was destroyed by natural
disasters. You incorporated that in your Continuing Resolution
during December.
Despite the assistance of the Continuing Resolution,
farmers are looking to you to pass a modernized five-year farm
bill as soon as possible. Our farmers also face challenges
related to their region, the weather, trade barriers, crop
protection, and all of these will be addressed in my written
testimony.
As Congress begins to work on the 2025 Farm Bill, Farm
Bureau supports the following principles to guide and develop
the programs: First one is to increase the baseline funding
commitments in the farm programs; maintain a unified farm bill
and that includes nutrition programs and farm programs
together, because they belong together; prioritize funding for
risk management tools, which include crop insurance and
commodity programs.
Now, the USDA's most recent farm sector income forecast has
shown a $41 billion decrease in net farm income, that is down
25 percent from 2022. Since crop prices peaked in 2022, they
have taken a nosedive. Corn and wheat are down 37 percent,
soybeans down 28 percent, cotton down 22 percent, and despite
these lower prices, 2024 payments out of the farm bill going to
farmers are projected to be the lowest since 1982 over four
decades ago. This again highlights the need for increased
coverage in Title I programs.
We also cannot imagine during a time of great economic
uncertainty that farmers and ranchers and many small businesses
across the country are anticipating what might be the largest
tax increase in America's history. Failing to extend the
expiring provisions of the tax cuts, and the Jobs Act, would
take billions of dollars out of our farmers' pockets where they
have no spare money anyway. Congress must find a way to create
a stable business environment, by making the expiring
provisions permanent.
Now, I also believe it is important that the Committee
recognize that the greatest domestic policy threat to American
agriculture is our outdated guest worker program and the labor
crisis farmers are facing across the country. In short, the
cost is too high, the domestic willingness to work on our farms
is way too low and farm families are shutting down their farms.
This is heartbreaking and has direct and tangible impacts on
our rural communities.
While I know it is not under the jurisdiction of this
Committee, labor is by far the leading issue that I hear talked
about and discussed. Now, I get asked about by farmers and
ranchers across the country, regardless of region or commodity.
Finally, this week we have seen many actions around trade,
with additional tariffs being imposed on our largest trading
partners. I want to assure this Committee, that Farm Bureau
will continue to be the voice of American agriculture and its
farmers to pursue and advocate for new markets and additional
market access for agricultural products.
Thank you, Senators, thank you for this opportunity to be
here today, and I really look forward to the questions.
[The prepared statement of Mr. Duvall can be found on page
58 in the appendix.]
Chairman Boozman. Thank you, Mr. Duvall. Mr. Larew.
STATEMENT OF ROB LAREW, PRESIDENT, NATIONAL FARMERS UNION,
GREENVILLE, WEST VIRGINIA
Mr. Larew. Thank you and thank you Senator Justice for the
kind introduction. I am sure I remember that when we bought
that corn that our milk production probably went straight up.
[Laughter.]
Mr. Larew. Chairman Boozman, Ranking Member Klobuchar,
Members of the Committee, as the sixth generation on the farm
in West Virginia, I am really proud to be here representing
family farmers and ranchers across the country.
According to the census of agriculture, we lost a
staggering 140,000 farms in the last five years. The average
farmers now are nearly 60 years old, and the next generation is
too often locked out. The uncertain future of the farm and
rural economy adds to anxiety in farm country.
At the same time, farmers and ranchers receive only 15
cents on average of every food dollar. Consumers are paying
higher prices at the store while family farmers or ranchers are
dealing with tight margins, few market options and increased
financial pressure. We must confront these challenges head on.
We applaud the Committee for quickly taking action this
year to hear from us. The stakes are high, not just for farmers
and ranchers, but for all the communities that rely on us.
Passing a strong farm bill is a great place to start. We
appreciated the efforts of Chairman Boozman and many other
Committee leaders at the end of last year to ensure the passage
of disaster assistance. We cannot afford a third extension of
the 2018 Farm Bill.
Congress must act quickly to pass a fully funded farm bill
in 2025. This farm bill should include strengthening the Farm
Safety Net and providing farmers with robust risk management
tools, investing in voluntary incentive-based conservation
programs, supporting the next generation of farmers, and
keeping the Farm Bill Coalition together.
The strong farm bill alone is not enough. We also need open
and fair agricultural markets. Farmers are the backbone of this
country, but too often we are being taken advantage of. As
farmers we love competition, but often our only option is to
buy from or sell to monopolies, resulting in higher costs,
fewer choices, and less innovation. We are not asking for a
guarantee, we are just asking for a fair shot.
We have opportunities to make the system work for farmers
by protecting and strengthening the Packers and Stockyards Act,
supporting mandatory country of origin labeling, like the
American Beef Labeling Act led by Majority Leader Thune, and
ensuring that farmers have finally full and complete freedom to
repair their own equipment.
In addition to fairness at home, we must also consider
fairness and global trade. American family farmers are often
the first to suffer from trade disputes. Tariffs can be
powerful when used in a smart way, but we have also seen what
happens when Washington gets it wrong. Farm income drops,
markets disappear and costs go up. Congress should focus on
expanding domestic and global markets, holding trade partners
accountable, and ensuring that trade policies are applied
carefully to protect and not harm American farmers and
ranchers.
Finally, recent executive actions are creating concern for
farmers and communities. No one knows what funding will be
available, or if key programs will have the staff needed to
operate. Freezing spending and making sweeping decisions
without congressional oversight just adds more uncertainty to
an already tough farm economy. We encourage this Committee to
seek clarity from the administration and make sure that farmers
and rural communities are not left behind.
In closing, the challenges facing farmers and ranchers
across the country are daunting, but not insurmountable. A
strong farm bill, fair markets and smart policies can assure
that the next generation has opportunities in agriculture.
Farmers' Union is ready to work with you to make that a reality
and deliver solutions that will give farmers a fair shot.
The last few months I have traveled across the country
visiting with family farmers about their challenges, and I look
forward to sharing some of those stories as we answer
questions. Thank you.
[The prepared statement of Mr. Larew can be found on page
65 in the appendix.]
Chairman Boozman. Thank you. Again, thank both of you for
being here. Let me ask you about two or three things, I will
give them to you all at once and then you can kind of digest
them and respond. Mr. Duvall and Mr. Larew, as you engage with
farmers and ranchers across the country, and both of you all
are so great, you are out and about as much as anybody, what
on-farm decisions are you seeing families make as they prepare
for the third consecutive year without a modernized Farm Safety
Net? That is one thing.
Then along with that, can you elaborate on what you see
happening in farm country if the Committee does not properly
prioritize and increase funding for the risk management tools?
Then last, along with that, can you describe the role you see
crop insurance playing for farmers? You have got diverse
memberships within your organizations, what are you hearing
regarding crop insurance improvements? If you can just touch on
that for a few minutes, Zippy?
Mr. Duvall. Well, thank you, Senator for your question.
Decision-making on the farm because we are not having a farm
bill has been very difficult for our farmers because we know
without a modernized farm bill--and the 2018 Farm Bill was a
good farm bill, but we have experienced inflation, Covid, the
cost of production going up, so many things have happened, we
are in a different environment today, and you all mentioned
that in your opening statements.
We are hearing that maybe 20 percent or more of our farmers
are going to have difficulties getting operating loans. We are
in a time where that should have already been done and they
should be having the seed in the barn ready to start planting,
and it is really hitting them at a hard, difficult time.
They are telling us they are losing money per acre. Corn
over $100 an acre losing, they are having to make decisions
which crops to plant, which crop not to plant, if I am not
going to plant? Do I let that rented land go and miss the
opportunity to have it in the future and someone else rents it?
There is so many decisions they are having to make.
You know, and I get the question all the time Senator,
about what worry keeps me up at night. What keeps me up at
night is who is going to farm in the future? Forty percent of
the farmers out there today is over retirement age, 300,000 or
less than 25 years old and most of them have off the farm jobs
to support their habit of farming. I do not know who is going
to be farming in the future if we do not make an environment in
agriculture that draws young people to us that can afford to
raise a family and create a home in rural communities and
support that economy there. That is why the farm bill is so
important now.
Risk management, too. The crop insurance is the cornerstone
of the farm bill, and it needs to be continued. It is where
farmers have skin in the game and pay for a premium, and the
general public has skin in the game through substituting other
premium to make sure that our food system stays secure from one
season to the next because of lower prices or because of
natural disasters or whatever might be happening. It is the
cornerstone.
The need in that area is we need every farmer, regardless
of whether he is organic, traditional, big, small, large, every
farmer that takes that risk needs some kind of risk management,
too. Crop insurance has proven itself over and over again to be
that tool to make sure that they can survive those
difficulties. I think I hit all three of your points.
Chairman Boozman. No, very good. Thank you. Mr. Larew.
Mr. Larew. First of all, Zippy and I were joking a little
bit before that you are going to hear a lot of the same themes,
right? The fact is that as we go around, we talk to farmers
across the country, there are just endless kind of examples of
folks both who are well established farmers and those who are
trying to make a go at it, but in the first few years. The
challenges are really kind of make and break for a lot of them
at this point.
I think about a couple of cotton growers, who have been
farming for years, who when trying to seek an operating loan
right now after three years of drought and low prices are now
facing really tough decisions. The bank does not know whether
or not they are going to be able to extend that loan.
As they are having that tough conversation, it is also
really apparent that these community banks, including the ones
that they were talking to, are also really struggling out
there. As they try to see whether or not they can get the loan
going forward, the bank is also trying to make that tough
decision. Can we afford additional risk on top?
I also think about a young farmer in North Dakota, who was
recently sharing experience about trying to get more land, to
rent more ground, to expand operations and in doing that, had
to invest in some new equipment. As a result of that is now
unfortunately, with prices overextended, and is now having to
sell on pennies on the dollar that farm equipment and is
seeking now to still pay off the loan, the financing for that
and does not know whether or not farming is in his future.
These are really just the kind of stories, whether it is
the more established folks who are eating through their equity
and putting their operations at risk or new and beginning
farmers who do not have yet that deep well of experience and
equity that they can burn right now. Those needs for risk
management tools, including crop insurance, are absolutely
essential.
I hope that as the Committee considers what to include in
the farm bill, that looking for ways to not only strengthen the
existing options there, but look for additional ways to help
support beginning farmers with that. Also, creative ways to
bring more into those risk management tools. I think that would
be a great place to start.
Chairman Boozman. Thank you. Senator Klobuchar.
Senator Klobuchar. Thank you very much, Mr. Chairman. I
will ask at another time, I appreciated you raising Mr. Duvall,
the agriculture labor issues, which I think while you are
right, we may not have jurisdiction over immigration on this
Committee, we can be a voice when it comes to farm labor. Thank
you for your comments, Mr. Larew on consolidation.
Just over the weekend, the President announced 25 percent
tariffs on Canada and Mexico. Just talked about them,
additionally, 10 percent tariffs on China, those went into
effect yesterday. Even though the implementations of the
tariffs on Canada and Mexico have been delayed for 30 days, it
has created incredible uncertainty in farm country.
Both of your organizations put out statements on Friday
raising major alarms on the potential implications of the
tariffs on farmers. I ask unanimous consent Mr. Chairman, to
put those letters on the record.
Chairman Boozman. Without objection.
The letters can be found on pages 157-159 in the appendix.
Senator Klobuchar. To both of you, the Canadian government
announced a long slate of U.S. products that would be subject
to retaliatory tariffs if these went into effect, including
baked goods, fresh fruit and vegetables, ethanol, and dairy
products. Canada has been a billion dollar plus market for all
these products. How will this retaliation and associated market
impacts affect the farmers that you represent? Okay, Mr. Larew?
Mr. Larew. Yes, thanks for the question. I would start
first with not only the potential implications of these tariffs
in place, but the real kind of experience that we are hearing
out there about suppliers of fertilizer and other goods who are
already adding costs onto goods that we are buying. We are
hearing some places that are not selling, for delivery,
products beyond a certain date because of the threat of the
town.
I think first of all, there is the very real kind of
challenges right now. I was just in Columbus, Indiana, talking
to a farmer who the whole time we were talking was on the phone
trying to get product across the Canadian border before any
potential threat there. Meanwhile, costs were going up.
I think that the threat brings real impact. Certainly, we
just have the last experience that we had with China to kind of
look at the combination of things from lost markets, increased
costs adding to already kind of increased inflation and so
forth. The costs are many in across the board.
Senator Klobuchar. Okay. Just to add a little bit here Mr.
Duvall, a recent study, depending on the type of retaliation
with the loss in value, for this is from Corn Growers and
Soybean Association for just their crops range between 4.8
billion and 7.4 billion, and we would be losing market share to
competitors in Brazil and Argentina. That is just as a result
of the tariffs in China alone.
Could you just talk about the long-term damage you could do
with trading partners, that even the uncertainty of all this
and they are just going to go look for products in other
countries?
Mr. Duvall. Senator, you said it very well, and that is one
of the concerns we expressed is that the potential of shrinking
the markets, because countries and companies can just decide to
go buy it elsewhere where they have reliability to the market
and do not have the access to it.
We do see our competitors in Brazil continue to do the
wrong things to expand their production down there to compete
with us, and it makes it very difficult on our farmers anyway.
The shrinkage of the market, we need more access, not less. We
need more fair-trade deals, not less. We need this
administration because we have not seen it for almost a decade
now, really getting fair trade deals to be put in place and
stick, with good rules of and keep people working under it.
The other issue is the cost of production. I think you said
it yourself, over 80 percent of the potash comes out of Canada
and that goes on our crop land. That would be devastating to
our farmers. Just that one example is difficult for our
farmers.
You know, we are very appreciative of the President and his
negotiation skills, and he has proven himself right in the past
in the first administration and had some success, and we are
looking forward to having more success. We are very
appreciative of his negotiation going on now, to be able to
delay it for 30 days and see if we can bring some common-sense
solutions to these problems because we need less interruptions
in the supply system, because it is our job to create a food
system for our people in this country that they can afford. It
is reliable.
We do not want to go back to the days that interrupt this
food system like we saw during Covid. There are several things
going on right now that could cause that.
Senator Klobuchar. Okay. Thanks. I just want to get one
more question here. Mr. Larew, we have heard from a lot of your
members that there is some difficulty in accessing the
conservation programs. This is something that Congress had, you
know, Article One, we had actually set up these programs. What
would be the implications of slowing down these programs for
farmers? Really the same when it comes to nutrition in terms of
making sure as we go forward that those programs remain strong,
Mr. Larew?
Mr. Larew. Yes, we are taking stories from all across the
country of producers who are certainly dealing with a lot of
uncertainty and a lot of expenses that they are due to be
reimbursed because they had a commitment and a contract for
certain activities with USDA. They have made that investment.
We have all talked about tight margins. I think it is worth
just highlighting the fact that in many cases system farms is
actually a negative margin. It is that all farm income that
covers it.
Having at this typical, this really critical phase right
now of that economic pressure having USDA delayed with a lot of
uncertainty about whether or not it will actually come through
is adding to that economic pressure in the countryside.
Senator Klobuchar. Thank you.
Chairman Boozman. Senator McConnell.
Senator McConnell. Lets stay on the subject of tariffs.
Most people do not think of bourbon as a agricultural product,
but in fact, it is. To give you an idea of how the Canadians
are already reacting to the potential of a trade war, there are
stories about taking American bourbon off the shelves already
to send us a message. My view is, if the threatening of
imposing tariffs produces something and you do not actually do
it, maybe there is an argument for them.
What I worry about, and I know all of us up here are
concerned about it, what happens to the $3 billion that we
export from Kentucky every year? I cannot think of any part of
it, the American economy that is more dependent on
international relationships and trade than agriculture.
My question is, and it is not unique, I think it has
already been asked and maybe adequately addressed by you. If we
actually get into a trade war. By the way, remember everybody,
that the current trade relationship between Canada and Mexico
was negotiated by this administration before and bragged about.
Obviously that seems not to be enough and so here we are on the
cusp of getting into this. If we do, what happens to American
agriculture?
Mr. Duvall. The President in his first term always said he
loved his farmer and he would stand behind him. He made that
commitment to me verbally and he did. Our farmers want to have
open markets. They do not want payments. Of course, in the
instance where we are being harmed for the protection of our
food system, for the protection of being national security
through our food system. We have to look outside of open
markets and do something to make sure our farmers can survive
the trade war.
That is not exactly what we want. We want the markets
themselves. This President's delivered that the first time and
we have had a seat at the table with him, and we look forward
to continuing to communicate with him on those issues.
It could be devastating to agriculture if we are not paying
attention to what happens. Not just agriculture, I am here to
represent agriculture, but we are here representing rural
communities and the consumer of our products, which is the
American people. It is going to affect the availability of it,
it is going to affect the cost of it and it is going to affect
the way we can do business at home on our farms.
Mr. Larew. Thank you, Senator. Just building on Zippy's
remarks, because I certainly echo a lot of what he just said
here. Our reliability as a trading partner out there is
certainly at major risk in this situation. I think that we are
still certainly in some commodities feeling the effects of the
last trade war that we had. Also, you know, even as our members
at their grassroots policymaking process, recognize that the
use of tariffs strategically can, as you pointed out, achieve
some results.
Knowing that we stand on the front lines of some of that
retaliation really puts a lot of things at risk and would just
restate the fact that we want competition, we want to receive
our income from the fair and open market not just payments.
Senator McConnell. One more Mr. Chairman, if I may. Isn't
it true that many historians looking at the 1930's thought the
Smoot-Hawley trade war exacerbated the Great Depression? You
guys are not familiar with that?
Mr. Larew. Not going to speak----
Senator McConnell. Not in your lane, huh?
Mr. Duvall. Well, Senator, I may be old, but I am not quite
that old, but my grandfather told me it was very difficult.
[Laughter.]
Senator McConnell. Well, there were a lot of things that
contributed to the depression, but that was widely thought by
historians of that particular period as contributed to the
economic problems. Not only that we had, but others around the
world had. Thank you,
Chairman Boozman. Senator Bennet.
Senator Bennet. Thank you, Mr. Chairman. Thank you to the
witnesses for being here. It is very good to see both of you. I
want to say to Leader McConnell, before he leaves, the good
news is that the product that he has from his commonwealth that
he is worried about is of deep concern to States all over the
United States of America, and is the lubrication of our
democracy in our economy in many ways. I think that a lot of
people feel his pain.
I also want to mention somebody that I know Jim Ehrlich,
who is from the San Luis Valley in Colorado, who we were
celebrating yesterday his retirement as the head of Colorado's
Potato Council, where he has fought for years and years and
years to open markets for potato growers in our State in Mexico
and other places, you know of his successes, you know of their
successes.
It is a reminder of why this trade discussion is not
academic or theoretical or ideological for our farmers and
ranchers. It is something they are working on every single day
because it is the only place, at least for the producers in
Colorado, where at least in the medium term, we are going to
see any growth, which is expanding our export markets for our
folks.
It is also not theoretical because we know, as Mr. Larew
said, that in the last round of this trade war, according to
USDA it cost agriculture $27 billion. The agriculture does not
want to be paid as Mr. Duvall said, or Mr. Larew said through
these payments, that is not how they want to be paid. They want
to be paid because they are producing and they are selling in
markets around the world.
My curiosity for you is why agriculture is the focus of our
adversaries around the world in terms of their response to
trade barriers. Like the ones that are being threatened by the
United States right now. Why is American agriculture where they
are likeliest to retaliate if that is how we approach it, just
as China did the last time, just as we are seeing Canada and
Mexico do this time, and is it because they understand how
tough our producers have it already one, and two, what it means
for families?
Zippy you mentioned a little bit about what it means for
families who are at the grocery store right now, already facing
higher prices. Could the two of you address that?
Mr. Larew. Well, in terms of why they are doing it, I think
you raise a number of really important pieces. I probably need
to speak to the trading partners themselves on exactly the
cause, but I think that the impacts that we know are likely to
happen, the economic stress, as you highlighted really across
agriculture and the dependence that a lot of our, not only
value-added products, but also commodities out there are
absolutely dependent not only on exporting, but also on being
able to receive inputs from a variety of places.
Having that kind of combination of increased costs, for
farming and then also lower prices for our products is a
double-whammy.
Mr. Duvall. Senator, historically, we have always been the
first one to hit and I think, and this is just my opinion, you
asked my opinion, it is the most essential thing in life. We
think this cell phone is important. It is the first thing we
pick up.
Senator Bennet. Actually, I would like to throw mine and
yours in the Potomac River, but go ahead.
Mr. Duvall. When I retire----
Senator Bennet. That is another topic.
Mr. Duvall. You know, we think it is the most essential
thing, but we cannot even accept what comes out of it if we do
not have the nourishment to run our bodies. I think if you look
across this country, in most States, agriculture is the leading
industry in that State, and it supports the economy of this
country and every community across the country.
Senator Bennet. That is well said. That is true in Colorado
and I think, as the Chairman said, and as the Ranking Member
said, our farmers are feeling stressed for all kinds of reasons
already, you know, not the least of which is we have not gotten
a farm bill passed, but to add this on top of everything else
is the last thing they need.
With the last 20 seconds, I just also wanted to respond Mr.
Duvall, to what you said about farm labor. I want to just
underscore, you said, it is the number one issue facing the
people that you are representing. This is something that we
have worked on a long time here, you and I have had a lot of
conversations about it over the years, and, you know, I have
been very clear that I believe that we need to secure the
Southern Border of the United States, and I have been
disappointed in the previous administration's work on that. It
does not mean that that is sufficient.
We need to figure out how to create a system so that we
support our farm workers and we support our producers, and we
do not lose these farms and ranches to Mexico, which is what is
going to happen if we do not figure it out. Thank you for
raising it, and I look forward to working with you and others,
the farm workers, to address it. Thank you, Mr. Chairman. Thank
you.
Chairman Boozman. Thank you. Senator Hoeven.
Senator Hoeven. Thanks, Mr. Chairman. I would like to thank
both of you for your work and helping us at your end with the
year extension, and particularly with the disaster assistance,
you both were very important in that effort, and I want to
publicly acknowledge that, and thank you. It is very important
that we got it done.
Based on both of your opening remarks, I do not know how
anybody could not be aware that to get the new farm bill done,
we need affordable crop insurance and updated reference prices
in ARC and PLC. Would both of you agree with that?
Mr. Duvall. Yes.
Mr. Larew. Yes.
Senator Hoeven. Updated prices in ARC and PLC. Would both
of you adamantly agree with that?
Mr. Duvall. Yes.
Mr. Larew. Yes.
Senator Hoeven. Thank you. Regarding tariffs, in the first
round President Trump used tariffs to try to negotiate better
trade deals for not just farmers and ranchers, but for
manufacturers too. Chinese did retaliate and we put in place
through our AGA Probes Committee, the Market Facilitation
Program. Ultimately, President Trump was able to negotiate a
$50 billion deal for agriculture.
I think Mr. Duvall, you referenced how prices were good up
until 2022, and they have declined precipitously since then. In
regard to tariffs, what kind of strategy would you advise the
administration undertaking? You know, what advice would you
give Brooke Rollins and our Trade Ambassador and the
Administration, President Trump, in terms of how best to
undertake that negotiation from an agriculture perspective?
We want fair markets, free markets, but we want fair
markets, and we do not have fair markets. Other countries take
advantage of us, and we need to deal with it. The President
tends to do that.
Mr. Duvall. That is exactly what we support, access and
fair markets. You know, we have the perfect example of what
happened during Covid. We have a supply system that supplies
food to this country, from our farms to our forks. Any
interruption in that system, is going to cause tremendous
problems at all levels of all links of that chain, any
interruption. We just cannot afford to do that.
During Covid, we said that the workers and the food system
was essential. What is essential mean? We got to have it. You
got to find some way to exempt it out of it so we do not
interrupt it. I grow chickens for a living. When they deliver
that chicken, they already know what day is going to be
harvested and where it is going to go.
If you interrupt that system, it hurts everything between
me and the fork. We cannot afford it, our people will not stand
for it in this country and agriculture needs to be identified
as an essential--not agriculture, but the food system, which
includes agriculture, needs to be identified as an essential
part of our everyday lives for every American across this
country.
Senator Hoeven. Mr. Larew?
Mr. Larew. Thank you for the question, because I think it
is a really important one right now. Certainly, the message
that we shared the last time we had the tariffs in place and
that we would share again, is everyone knows that China is a
bad actor in this. Even as the administration was able to kind
of achieve the Phase One Agreement and additional kind of
benefits there which were really encouraging, we know that they
end up falling back on all of those promises.
We would certainly encourage wherever possible that the
U.S., who is not alone in having a poor trading relationship
with China, to work with allies, to come together to try to
address a lot of those challenges. That said, if we know that
retaliation is imminent, making sure that through examples that
you said, with the market facilitation loan, that we already
have plans in place, should we reach that point of retaliation
or impact directly on the farms.
That much to Zippy's point here that there is certainty,
that there is continuity out there, because too much is at
stake to have that disruption.
Senator Hoeven. I think that is an important point there. I
would emphasize, and again, ask both of you both in terms of
the disaster assistance and then also whatever programs we need
to make sure we keep our farmers in the game while we go
through these negotiations to get them better access to markets
that we can work closely with you, with the associations, not
only Farmers Union and Farm Bureau, but all the commodity
groups as we go through that process and your commitment to
work together on that.
Mr. Larew. We would welcome it. Thanks.
Mr. Duvall. That is our job. Our job is not to be critical
of one party or the other, or one President, Administration, or
the other President. It is our job to be the voice of the
farmers across this country and to express the concerns of
policies that being considered, it is our job to do that. I
know my friend here and I are committed to make sure that we
express those concerns and we will express congratulations when
we accomplish something
Senator Hoeven. And be helpful in the process?
Mr. Duvall. Yes, sir. We look forward to working with that.
Thank you.
Senator Hoeven. Thank you both.
Chairman Boozman. Thank you. Senator Smith.
Senator Smith. Well thank you, Chair Boozman and Ranking
Member Klobuchar, and welcome both of you to our panel. I think
the last time I saw both of you, we were on another panel
together at Farm Fest in Minnesota last rainy August. It is
good to see you again.
I also just want to take a moment to welcome Mr. Tim Deal
to the Committee today. He is a fourth generation Minnesota
farmer and is on the Minn-Dak Sugarbeet Cooperative Board and
is here today with the American Sugarbeet Growers. Welcome to
the Committee.
I also just want to associate myself with the comments that
have been made by the Ranking Member and others about the
crucial importance of getting on top of issues around farm
labor, and of course, the trade conversation we are having. I
think it is just vitally important.
I want to focus, if I can for a minute on--I have got to
tell you, I am just really concerned about the Trump
Administration, DOGE Federal employee buyout and hiring freeze
that is happening, and what impact that could have or will have
on USDA impact on the food and agriculture sector access to
disasters assistance, risk management tools, and ultimately how
this could hurt consumers.
For example, just this morning we heard reports about food
inspection, food safety inspectors taking the Federal employee
buyout, which could result in not having enough inspectors.
Minnesota meat processing facilities, you know, understanding
Minnesota is a huge producer of hogs and largest turkey
producer in the country.
Another example, you know, we have had a lot of reports
from Minnesotans, and I think around the country about
challenges with staffing at FSA and the NRCS staff at the local
offices and what a barrier that is to farmers getting access,
having a trusted partner to help them navigate and get the
assistance that they need.
I want to just note that last year I worked with Senator
Ricketts, with the USDA to get some recommendations back on
what we could do better there, and got some good
recommendations back. That is a start in the right direction,
but I do not want to lose that momentum. I am wondering, could
each of you comment briefly on what impact staff reductions in
local USDA offices would have on your farmer members, given
these offices are already understaffed?
Mr. Larew. Well, it is already occurring right now. There
is a lot of uncertainty out there in those county offices and
in spite of the fact that we are the envy of the world in
having those USDA personnel in those county offices, that
direct connection to farmers and ranchers for the important
USDA programs, staffing and the continuity of those operations
is a challenge in the best of times, I think, as you were
saying.
Right now, that is just being exacerbated. We are even
hearing the return to office, we do not have folks who even
have an office to come back to.
Senator Smith. That is right. I have been out of office for
years. This has nothing to do with Covid.
Mr. Larew. That is right. We are hearing those stories and
just, you know. One thing that we are leaning into is the fact
that the National Department of Union signed a memorandum of
understanding with USDA toward the latter part of last year, to
look and evaluate at staffing opportunities, if you will, into
the future ways to make service better and improve. That does
not necessarily mean additional staff, but making sure that the
programs that we depend on can function.
Senator Smith. Exactly. Mr. Duvall, if you would like to
comment briefly on this, and I am hoping to get in another
question.
Mr. Duvall. Sure. I will do it quickly. The last two
secretaries, Secretary Perdue and Secretary Vilsack, I had
extensive conversations about the lack of help in our county
offices. As far as meat packing inspectors, we have farmers
that want to go directly to consumers, but they have to
schedule their meat pack processing two years out. You
understand, the cow's going to carry the calf exactly nine
months, two years out to be able to get a kill date and harvest
date and that is not a good situation. This is just going to
compound that situation
Senator Smith. Thank you. I appreciate it also, you both
bringing up the challenges of new and beginning farmers getting
into the business, this generational transfer that is
undergoing. I also note Mr. Larew, you talking about how it is
that in this country today, farmers are keeping only about 15
cents out of every food dollar, pardon me. And are often in the
position of buying or selling from monopolies and I mean, I
think these things are all related.
I mean, one of the reasons it is hard to get into farming
is because of the concentration. One of the reasons that
farmers are not making a good income is because they are just
not in a strong market position compared to these large
conglomerates that are dictating prices, not only from how much
they are paying for input costs, but as well as how much they
are going to get for that turkey or that beef.
This is something I really respect Senator Grassley for his
work on this. I know that this is very important and is an
issue of bipartisan interest. I guess no minutes left. If you
could just briefly comment on how you see your members being
affected by this market consolidation.
Mr. Larew. Oh, it is across the board. I mean, certainly
there are opportunities as a result of that consolidation, and
that includes things for direct to consumer as it was noted
here.
Mr. Duvall. Yes. You are exactly right. The pressures that
are on small, medium-sized farms, and you recognize yourself,
with the advantages of being large, you can buy things cheaper,
the pressures even more. The American people love medium,
small-sized farm, family farms, and that is what they want to
exist and want to be able to buy their commodities from.
Everything, time we put a regulation in or something like this,
it makes it more difficult for them to stay on their farms.
Senator Smith. Thank you very much, Mr. Chairman
Chairman Boozman. Senator Grassley.
Senator Grassley. Thank you, Mr. Chairman. Thank you folks
for attending. I have been a member of the Farm Bureau since
1956. Before I ask any of you questions, I got a short
statement.
Over the last four years, American crop farmers had a year
or two of record high net cash farm income, so profitability
for maybe one fourth of that period of time. Unfortunately,
American farmers have also had to face years of record high
inflation under an administration that was largely deaf to
farmer's needs.
In 2023 and 2024, net cash farm income dropped
dramatically. In other words, roll crop farmers losing money,
the stagnant trade policies, lack of ambition to find new
markets for commodities and over regulation of the Biden
Administration caught up with farmers. Many family farmers in
Iowa have faced machinery and land payments with high interest
rates farmers have not seen in decades while dealing with steep
downturn in commodity prices.
Now, it seems to me that this trend will continue until new
markets are created for agricultural products. My first
question deals with packers and stockyards. I understand this
hearing is focused mostly upon crop commodities, but I would
like to take this opportunity to ask you about the Poultry
Grower Payment System and Capital Improvement System rule that
was finalized under Secretary Vilsack.
I think the rule is badly needed. This rule is meant to
provide more transparency for poultry producers under the
tournament system and give farmers a fair shake in contracts.
To you, Mr. Duvall, and I will have a little different question
to Mr. Larew on this subject. Can you speak to how this rule
may positively affect producers' bottom line?
Mr. Duvall. Thank you, Senator. I am a poultry producer for
37 years now, and I have experienced every good and bad event
that could happen in the integrated system. We have a system
that we describe, and I have heard secretaries of agriculture
describe, as nothing more than a modern-day share crop farming
system. We know how that turned out years and years ago. It was
not good.
We need transparency in the system. Our farmers need that
tournament pay to be changed so that they have a base pay, not
only for them, but their bankers that are depending on them to
make payments and their families depending on them to make a
living. That transparency will help us understand--what people
do not understand about animal agriculture, especially in
integrated system.
When that chicken is delivered to me on my farm, there are
three things that go into how it, how it really performs. One
is the environment that it lives in, and that is my
responsibility, and I have computers and people making sure
that it is perfect all time. Matter of fact, my wife all
accused me of taking better care of my chickens, than I did my
children because they were warmer.
Second is the quality of feed. I have absolutely no control
over it. Third, and all of us know, deal with animal
agriculture, understand how important genetics is. We have
absolutely no control over genetics. Two of the three legs that
determine how that chicken's going to perform is not controlled
by the farmer, and he should have the transparency to
understand what is behind that chicken. Because we all know in
animal agriculture, it depends on the age of the mother, how
they are taken care of, and the quality of the genetics.
Senator Grassley. Mr. Larew, I come a little bit different
on this same subject to you. Could you speak to how changing or
removing pieces of this rule may negatively impact poultry
producers? I am only raising that question because there might
be something coming down the road when you have a new
administration.
Mr. Larew. Well, certainly. We think that the rules should
continue to stay in place. I think that to your point here and
much kind of building on Zippy's question here, bringing
certainty, bringing transparency is absolutely crucial. I think
that there are ideas and ways to continue to improve, not only
contract growers' issues here and poultry but other sections of
the Packers and Stockyards Act that also have room for
improving. When we look at transparency, that is true not only
in poultry, but also needed sorely across the rest of
livestock.
Senator Grassley. Just want to make one final point that I
hope you can work hard for E-15 year-round nationwide, because
that is going to help commodity prices more than probably a lot
of things we can do here. Thank you, Mr. Chairman.
Mr. Larew. Happy to support.
Mr. Duvall. We most certainly will.
Senator Grassley. Thank you.
Chairman Boozman. Senator Lujan.
Senator Lujan. Thank you, Mr. Chairman, and thank you
Ranking Member for holding this hearing today and for our
witnesses joining us today as well. Mr. Duvall, on its website,
the Farm Bureau describes Title IV Nutrition Programs as
``reaching all levels of the supply chain from the farmer's
growing produce to the grocery store employee who puts it on
the shelf''. Mr. Duvall, do you agree that Federal dollars
invested in the Nutrition Title IV of the farm bill have a
positive economic impact on farmers who grow the food being
purchased using these dollars?
Mr. Duvall. I do.
Senator Lujan. Mr. Duvall, I just want to take a minute to
talk about the history of the farm bill. Since a Nutrition
Title was first added to the farm bill in 1973, the year after
I was born, farmers anti-hunger advocates, Democrats and
Republicans all have come together consistently to pass a farm
bill that ensures the food grown by our farmers makes it onto
the plates of Americans.
Unfortunately, there are proposals being considered now
that would undermine decades of success and disrupt the broad
bipartisan coalition that has historically been the key to
passing a farm bill. Mr. Duvall, would proposals to cut
nutrition programs through budget reconciliation, a move that
would impact the baseline of the farm bill, impede the ability
of Congress to pass a farm bill that meets our needs in farm
country and supports American families?
Mr. Duvall. Your question is, would it impede it? I would
think that would be a difficult conversation, and I think that
is the conversation you all will be having. Of course, it is
our job to represent all of farm bills. We do know the benefits
and we do support the nutrition program, but we also know that
there is a way smaller percentage it goes to helping support
our food system through farmers to make sure that it gets from
one season to the other. That has been way too long of getting
some attention of broadening the baseline where my comment
started in the beginning.
Senator Lujan. Where I will agree, Mr. Duvall, is that
there needs to be support for our farmers and ranchers and food
producers all across America.
Mr. Duvall. Yes, sir.
Senator Lujan. There is also been a grand bargain, if you
will, to work with colleagues and all sides of this to say we
should support our farmers and ranchers and we should support
nutrition programs.
Mr. Duvall. Nutrition programs were designed to give people
hand up in difficult times in their life. We support that.
Senator Lujan. Amen to that, sir, I appreciate that
Americans wake up with fresh produce on their tables and cold
milk in the fridges due to the hard work and dedication of this
country's farm workers as well. These workers are an integral
part of our country's agricultural economy and work every day
to feed families across America.
The response to that sacrifice has been relentless attacks
by this President and others in his Administration due to some
of their efforts as we see going on right now. I have raised
this with Ms. Brooke Rollins who I believe will be the next
Secretary of Agriculture for the United States of America as
well. Now, Mr. Duvall, yes, or no? Did you know that the USDA
estimates at roughly half of the workforce is undocumented?
Mr. Duvall. Yes, sir. Our number is 40 percent.
Senator Lujan. Do you think our farmers, ranchers, and
agricultural operations who depend on that labor will survive
when roughly half of the workforce is unavailable?
Mr. Duvall. First, I would like to say our farmers want a
system that they can work within the law----
Senator Lujan. Amen.
Mr. Duvall [continuing]. and have a consistent workforce
that is reliable, so they can deliver their crops on time, good
quality. In your question----
Senator Lujan. Mr. Duvall, what happens if--I will use your
number. What happens if 40 percent of the workforce for farmers
and ranchers disappears?
Mr. Duvall [continuing]. it would be devastating to
agriculture. You would see farms go out of business, and we
could see an interruption in our food system like we saw in
Covid.
Senator Lujan. I appreciate that, sir. This is an area, Mr.
Chairman, I think that we can work on. The strongest bipartisan
bills that came out of the house recently was with farm
workers, with agriculture, with finding a way to get that done.
Unfortunately, we did not get it through the Senate. It is one
of those strong tools that I believe that we could look at as
well and make sure that we have a stronger system.
We can do it at the same time by investing in border
security, we can have strong border security, we can fix a
broken immigration system, we can do this in a bipartisan way.
You know, first attention should be to what is going to happen
to farmers and ranchers when it comes to lowering costs for the
American people, when it comes to food, when it comes to making
sure that our farmers and ranchers are going to have the tools
that they need to be able to grow those crops, collect those
crops, keep them strong, keep them moving as well.
I look forward to that as well. Appreciate this hearing.
Appreciate your time for being here. To our witnesses, thank
you. Mr. Chairman, I yield back.
Chairman Boozman. Thank you. Senator Hyde-Smith.
Senator Hyde-Smith. Thank you, Mr. Chairman. Thank you to
our witnesses for being here. We have so many witnesses that
some of you I have already met with, we certainly appreciate
you taking your time to come to Capitol Hill because you are
truly helping us help you. I want to tell you how grateful I am
for that.
You know, as we know, it is no secret that the U.S. economy
and farming is headed in a dark direction right now. The U.S.
farm economy, the 2023 crop year was bad, 2024 was horrendous
and the upcoming crop year is not looking very pretty as well.
Farm income has dropped roughly $41 billion over the last two
years. The worst decline we have ever seen. Our trade deficit
is expected to reach a record high, $45.5 billion for Fiscal
Year 2025. This is the deficit that we are looking at.
We used to brag about our trade surplus and we are
certainly not in that position right now. Input costs are
through the roof, while crop prices are lower today than they
were 15 years ago. The Federal Farm Safety Net is not providing
adequate support to keep our farmers and ranchers afloat, and I
have certainly been pulling the alarm on this because I know
the seriousness of this.
Because of this, producers across the country are literally
going out of business. In short, U.S. agriculture is just in
trouble. When U.S. agriculture is in trouble, when the farms
are in trouble, the banks, the retailers, the equipment
dealerships, grain buyers, the gins, the textile mill, the
transportation business, but more importantly, those who are
most in trouble are the ones we feed.
Rural America is definitely in a crisis mode. Partly
because Congress has yet to come to terms with the fact that
commodity support programs under Title I of the farm bill are
inadequate, and they are in desperate need of improving and
they have been for a long time. Title I of the farm bill, which
is the vital component of the Farm Safety Net, accounts for,
listen to this, roughly five percent of the farm bill baseline,
five percent, that is all.
When folks say that we need more farm in the farm bill,
this is what they are talking about. It is just so essential
that we let Americans know the problems that we have and the
seriousness of this. You know, we all know that when you stop
production, if you shut down all the production on the West
Coast of the produce, if you shut down the slaughter facilities
of poultry, of our beef packing plants, if you shut down the
combines for 30 days, we would have enough food to feed this
country for maybe 30 days.
Its consumption is consistent, constantly eating every day
of what we are trying to provide, so we have to provide it
every day. We are the ones that feed you. Mr. Duvall, would you
agree with me that commodity support programs under Title I
deserves significant improvement and significant investment?
Mr. Duvall. I would agree with that, Senator.
Senator Hyde-Smith. The U.S. farm economy would be in a
different place right now if Congress had made these proper
investments and enacted a new farm bill a year ago. Would you
agree with me on that?
Mr. Duvall. Totally agree with that.
Senator Hyde-Smith. That Congress should invest in Title I
programs in the next farm bill as soon as possible to prevent
today's problems that we are experiencing to get even worse
than what they are.
Mr. Duvall. Would agree with that too.
Senator Hyde-Smith. Mr. Duvall, as you know, agriculture is
Mississippi's number one industry and primary economic driver
in our State, as we have discussed earlier in many States. I
have recently been hearing that stakeholders across Mississippi
and the country are concerned about their future access to crop
protection tools and biotechnology products. Without these
Mississippi farmers, farmers from all the States that are
represented here today, we cannot produce a viable crop.
Farmers in the South are subject to some of the most
notorious insects and weeds in the whole world, and they have
to overcome this once considered impossible, thanks to these
amazing scientific innovations, that the Bureau of Plant
Industry and Mississippi State University. There are so many
strides that have been made in my lifetime. I have seen yields
increase 400 percent because of these strides. We cannot stop
this. This is national security.
You think a country will fight a war over oil. You let them
get hungry. It is our jobs to do that. I so appreciate the
diligence both of you impress on me, that your determination to
do that because we are definitely in this together, everybody
has to be on board.
In your testimony, you mentioned the importance of sound
risk-based science when it comes to approaching crop protection
tools. Will you please elaborate on that? Just how much is it
at risk if we abandon a science-based approach to regulating
crop protection tools and the biotechnology?
Mr. Duvall. It is absolutely critical that we continue to
have faith in the system that provides the science-based tools
that we use on our farm. You know, one out of 10,000 products
make it to market, one out of 10,000. It takes almost 11 years
to get a product to the market.
They got 350 scientists at EPA or whichever department it
is, making sure that those things are safe. Our farmers, apply
it according to the label because they own, live and grow their
families and work on their families, work on that farm where
they are applying those crop protection products, so no one is
going to do anything to hurt their own family, let alone
someone else's and the land that they invested generations and
generations into improving it.
If you could look at my farm today versus what it was when
my grandfather bought it, which was ditches and gullies and
weeds growing on it because of the things we did not do right
when cotton was king, you would see that for decades our
farmers and ranchers have done the right thing to regenerate
their soils. Because mine is a rolling green hill where cows
graze now and they have done the right things to grow more with
less. They have done the right things to use less crop
protection tools to grow more. Everything that we have done has
been good for the consumer, for the farm, the land, and also
for the environment.
Senator Hyde-Smith. Thank you so much for your answer. God
bless the farmer. Mr. Welch, I believe you are up.
Senator Welch. Thank you very much and much of what you
said Senator Hyde-Smith, I totally agree with. I am so
impressed with your testimony. What is so interesting to me, is
so many of the things that you said, if we had two farmers from
Vermont, they would be saying the same thing.
The other thing that I think is an opportunity for this
Committee, we all care on this Committee, both sides of the
aisle, about Rural America, you know, Vermont, their dairy
farming, vegetable farming, it is the backbone. Those of us who
do not farm benefit by those who do farm, and I just want to
express my appreciation.
We have an opportunity in this divided country by focusing
on the needs of agriculture in each of our areas to try to
bring us together because we all do value the farm activity
that is different in Vermont than West Virginia or in Georgia.
I just want to go through a few questions. Number one, the
right to repair. How in the world, farmers are really good at
fixing things, why cannot they just fix whatever it is they can
fix? I support right to repair. How about you? That brings cost
down, right?
Mr. Larew. Yes, absolutely. It is cost not only in terms of
equipment and the parts and labor for that, but also the time
that is often lost in harvest and delays in getting into those
repairs.
Senator Welch. Let me just make a point. You know, the
commodity price that we have to deal with in order to make sure
there is a safety net is one side, but if we can bring the cost
down, that helps as well, right? Because the input costs are
less.
Mr. Larew. Absolutely.
Senator Welch. Number two, tariffs. One of you was talking
about potash. We had a meeting in Vermont, and that is what
they talked about. One of our grain suppliers who really works
very closely with the farmers, they are going to get hammered
if the price of that goes up and we get most of it from Canada.
My view on tariffs is do no harm, that should be the starting
policy. Would you agree with that?
Mr. Larew. Absolutely. We are already seeing the effects.
Senator Welch. Yes. We just should not do that to our
hardworking farmers. Also, my understanding is the last time we
had tariffs, a lot of our Midwest farmers lost market share to
Brazil. That has not come back. Do you see that as a
possibility that could happen again?
Mr. Duvall. Very much so, yes.
Senator Welch. Well, also, you all talked about how hard it
is for young farmers to get involved, and that is certainly
true in Vermont. The cost, everything is really, really
difficult that we have introduced a bill on farm ownership, the
Farm Ownership Improvement Act. What it would do, is allow for
pre-approval and pre-qualification process that is in the Farm
Ownership Improvement Act that benefits farmers who are
starting. You get this pre-approval; it cuts the red tape. Does
that make sense to you as an option?
Mr. Larew. We are definitely in support.
Senator Welch. Well, I appreciate that. Another thing, the
Weather Act, we are getting wild weather. I know you have had
it in West Virginia and Georgia. We have certainly had it in
Vermont. Big floods in July of 2023, July of 2024 crops got
wiped out. We have to have an insurance program. These are
vegetable by and large, where the hassles that these farmers
had to go through, they had to account for like each type of
vegetable. Carrots, how many onions did you lose? How many
radishes did you lose? They went by wholesale price when all
these farmers sell it farmer's market at retail. Do you think
it is time to change that?
Mr. Duvall. Definitely.
Mr. Larew. Yes.
Senator Welch. Well, you guys are doing a great job, I got
to say. My hope is that Senator Marshall and I have worked
together on a lot of things including this. We have got to take
the rhetoric out here. Like for instance, farm labor you
mentioned immigration, big issue, very controversial, very
political. You know what is very simple? If you do not have
farm labor in Vermont, you do not milk the cows and you do
not--so you are with us on trying to do something that gives
stability for farm labor so that our farmers who absolutely
have to have that labor are able to get the job done, right?
Mr. Larew. Absolutely.
Mr. Duvall. Yes sir.
Senator Welch. Well, thank you. You know, another thing, I
am going to say this, it is Black History Month and I just want
to celebrate it and I know there is a lot of young black
farmers who would like to get back on the land. Many families
especially in the South, as you know, did lose the foothold
that they had. My hope is that we will include folks who have
lost their land through historical reasons.
I will not ask you to comment, but I know, you know, any
young farmer is a farmer we want to get on the land. Would you
both agree with that?
Mr. Larew. Yes.
Mr. Duvall. Yes.
Senator Welch. Well, I got to say, I appreciate hearing
from you. I do think the work you are doing has the potential
for us to unify and do things that get farmers stronger and our
rural community stronger. Thank you very much and I look
forward to working with you. I look forward to working with my
colleagues. Thank you.
Senator Marshall. Thank you, Senator Welch. Well, good
morning, gentlemen. It is kind of lonely up here today.
[Laughter.]
Senator Marshall. Everyone is out voting and I am sure more
will come back in a moment. Mr. Duvall, I want to talk about
farmer mental health for a second, and farmer suicide. This is
something near and dear to my heart for many reasons.
Over the past several years, we try to go out in the
communities doing round tables, trying to connect the dots. The
resources are out there to help. I want to back up and just say
to all my farmers and ranchers, the pressure is very real. The
pressure of losing a fifth, sixth, seventh generation farm to
be that person that could not keep the farm together in the
family, that is an immense amount of pressure.
Then I think that I wanted to talk about solutions, and I
know American Farm Bureau has been out here trying to connect
these dots as well on the resources and appreciate the
education programs you are doing with the farmers. I am trying
to work with lenders out there. The lenders were some of the
first people to see the signs and symptoms of depression. I
think we are making progress, but it is still tough times in
agriculture land.
Mr. Duvall, maybe speak just a second about farmer suicide
and what American Farm Bureau is trying to do to help us out in
this situation.
Mr. Duvall. Sure. Our organizations have worked arm in arm
to try to bring awareness to this. You know, and this is a
difficult subject to talk about, it really is. I did a survey
in the Georgia, Florida area and the alarming fact that we
heard is that young farmers that farmed, I will try to get you
to statistics correctly, because I am going off memory, I think
less than 10 years, that 50 percent of them had considered
suicide in those 10 years. Fifty percent.
I am a crusty old farmer, when my wife died, I bottled it
all up inside, like crusty old farmers do, and they say, we do
not talk about our feelings. Well, I was wrong. It is, okay to
not be okay, but it is not okay not to talk about it. We got to
get rid of the stigma that goes along with it. The only way to
do that is to talk to farmers, make farmers and the families
aware to be noticeable of what is going around. Just like you
working with the Farm Credit system, because they see them
every day.
A farmer in Minnesota, him and his sons ate breakfast one
morning together before they went to church. They came back to
church, ate lunch together. They talked about some of the
issues, financial issues of the farm and before the sun went
down, the dad had taken his life----
Senator Marshall. My goodness.
Mr. Duvall [continuing]. that cannot continue to happen. It
is a disaster.
Senator Marshall. You know, I just encourage everybody to
be a good neighbor. Most of us notice when our neighbor
suddenly is not going to church or they are not going to a ball
game. There is some of those very subtle hints out there that
we are all aware of.
Mr. Duvall. Sometimes all it takes is a text message or go
by and pick him up. Take him for a cup of coffee and open up
your ears and let them talk. Sometimes that is all it takes.
Senator Marshall. Yes, being a good neighbor. Mr. Larew, in
your testimony you talked about farmers selling to monopolies.
How do we put farmers back in control? Then what else can we do
to give the farmer more options? I am sure you have thought
about this.
Mr. Larew. Yes, I absolutely, and I really appreciate the
question because the challenges are very real out there. If we
look at those who are raising cattle, to selling to the beef
market right now it is a whole combination of things, right? It
is making sure that first, we are not doing any harm in terms
of our trading relations. Making sure that we have the existing
resources out there for slaughter and processing continues so
that that market flow continues.
At the end of the day, we still have a highly concentrated
beef market, for example. This is true across agriculture,
where the opportunity for collusion and manipulation of the
market is too great. Whatever we can do to reinforce the laws
on the books, not necessarily seeking new laws, to enforce our
antitrust regulations, and then to also make sure that the
Packers and Stockyards Act is truly serving the needs of our
farmers and ranchers out there.
I think those are great places to start. We are also
starting to invest in additional processing and marketing
opportunities. It is a combination of things along the line.
Senator Marshall. Great. One thing we have pushed for is to
allow beef to be sold across State lines with the State
inspection, and trying to provide farmers and ranchers with
easier access to the markets as well. Go ahead, Zippy, you got
a comment? It looks like.
Mr. Duvall. Also, in a world of technology, there has got
to be a better, more efficient way of doing it rather than the
way we are doing it. Make sure that that availability is out
there.
These small, medium sized packing houses are under huge
pressure to be able to make a profit just like the farmers are.
As they get in those positions, they tend to go out of business
and then that takes it away from the farmers being able to
utilize it. If they become a threat to a larger packer, they
just buy them.
Senator Marshall. Thank you. Next, we need to turn to the
Senior Senator from the great State of Kansas, Senator Moran.
Senator Moran. Thank you. Nice of you to recognize me,
Senator Marshall. I am pleased to be here in my debut hearing
as a newest, most Junior Member of the Senate Committee on
Agriculture. I appreciate the opportunity to be back fully
engaged in this arena.
I just want to raise a couple of things. I would like for
you to highlight for the Committee and for the Administration,
for the new Secretary, something that we have highlighted to
her and others as recently as this morning with conversations
with USDA personnel, but the quick implementation of disaster
assistance. Just a reminder of why that matters. It is a matter
of, needs to be a matter of days and a week or so, not a matter
of months or longer. Please briefly tell me why that is
important.
Mr. Duvall. Well, one, we need the secretary placed in her
position and we look forward to that because, the sooner we can
do that, the sooner we get it out. It is absolutely critical we
do this because we have been put in this situation because we
do not have a modernized five-year farm bill. It has been
kicked down the road two years. We appreciate the extension,
but it is not going to solve the problem.
Mr. Larew. We have already talked about the economic
challenges out there. Not a lot that are ongoing, not only
looking back, so the need to get that rolled out as quickly as
possible is actually paramount. Absolute.
Senator Moran. My next comment may not be a question, but
it is something I want to highlight that you both indicated
that you, I think it was you, Mr. President--I guess that does
not limit the scope of who I am talking about. the Farm Bureau
President, Mr. Duvall, representation, not just to farmers,
representation of the communities they live in Rural America.
I mean, I really think this is hugely important to the
country as well as to the people who want to raise their
families in a place that we all call home. I would highlight
that just the things that we face, that you will have policy
positions and inputs on. We have talked about tariffs, we have
talked about disaster assistance, the tax provisions.
Zippy, you mentioned those in your opening statement. The
continuation of those provisions, a new farm bill that just has
huge consequences on farmers, obviously, but that is the result
of our decisions and outcomes of those debates determines
whether or not my hospital doors stay open, there are kids in
our schools, whether or not the grocery store exists. For a
long time, I have indicated that where I come from, economic
development is often whether or not there is a grocery store in
town. That requires, when you say that sentence, a lot of
explanation, well, why would that be? In the absence of
farmers, we lose community banks, grocery stores, the hospital.
Those things are important. It suggests to me that we need to
have a complete focus on how do we get commodity prices up in
addition to getting input costs down.
I would indicate that renewable fuels is an important
aspect of this. We are fully engaged in trying to pursue and
implement SAF, renewable aviation fuel. Trade agreements, you
both have mentioned it is--I would welcome your input on what
countries stand out to you that are prime for us to reach a
bilateral trade agreement with. I will pause there for that
answer.
Mr. Duvall. First one that comes to mind is India and the
Asian Pacific Rim.
Mr. Larew. Yes, I would absolutely agree with that. I
think, you know, implied by your question is also making sure
that those existing markets that we have, that we rely so
heavily on are not lost.
Senator Moran. That is a good point. You know,
occasionally, I will have someone in Kansas, a farmer perhaps,
who indicates let's take care of ourselves. I am all for doing
that, but taking care of ourselves, in the case of agriculture
means trade, exports, it means markets. My answer has been
sometimes, so what 40 percent of acres in Kansas do you not
want to plant and harvest? Because we produce more than we can
consume, and therefore all the opportunities we need for
exports, all the opportunities we need for trade, all the
opportunities we need to utilize that, the commodity outcome,
the output into other products, including renewable fuels,
become all the more important. What am I missing?
Mr. Duvall. Well, you know, yes, we do need to take care of
ourself. If we do not produce that 20 percent of our income
comes from exports, what we do when we have a bad year, or we
are going to just fall short if we just produce for ourself.
That is all. It is critical that we maintain those trade
treaties out there because it is a big part of our income and
it stabilizes our system in case of emergency.
Mr. Larew. Maybe just kind of stepping, additionally, on
top of that, those domestic opportunities, whether it is
investing in those communities with value added products such
as biofuels and so forth, those domestic market opportunities
have to be continually invested in as well.
Senator Moran. Thank you. Finally, my conversation with
USDA this morning, along with the Chairman of this Committee
and the Chairman of the Appropriation Subcommittee on
Agriculture, dealt with what we believe to be true is that $560
million worth of food commodities is setting on in ports
awaiting the ability to be moved to places where people are
starving. While there is certainly a moral component to food
aid, I thought it might be valuable for you to remind me if
there is a value to farmers.
I remember in the last Trump Administration, I was driving
through Kensington, Kansas, grain sorghum piled on Railroad
Avenue, Kensington's a town of a few hundred people, elevator
along Railroad Avenue, and the grain piled on the ground was as
high as the elevator. In addition to trade and exports, what
role does food aid play in helping farmers have a better
outcome in their economics?
Mr. Duvall. Any food aid helps in that economic picture for
farmers. It is important to realize that we support
efficiencies. We want it done in an efficient way and not be
wasteful, but we also got to think about the sustainability of
our world. I have had the opportunity to have a general's son
marry into my family, and he is retired now, but I remember
distinctly having a conversation with him, and he says what you
do brings more stability to this world than anything else.
Because when people get hungry, they get mean and mad, and they
get jealous of our country that has everything available to
them because of the food system.
Mr. Larew. Our members certainly recognize both the
humanitarian need for that food aid, but also the impact that
they can have in terms of bringing stability to our own markets
and so forth. Particularly now with a lot of pressure on a lot
of those commodities, some of those commodities are at risk
should there be major disruptions here to falling even further.
Senator Moran. Thank you both.
Chairman Boozman. Senator Tuberville.
Senator Tuberville. Thank you, Mr. Chairman, and thanks for
holding this hearing. As everyone in this room knows, the state
of agriculture economy is in dire straits. We are in trouble.
It is not getting much better. Our farmers are struggling.
Producers have lost over $40 billion in net farm income since
2022. The current agricultural trade deficit is $45.5 billion.
We cannot stay on that same track.
Producers in my State of Alabama and across the country are
producing bumper crops, but they cannot break even much less
make a profit due to low commodity prices and high input cost,
interest rates, inflation. It has been 13 years since reference
prices for Title I commodities have been updated, yet the cost
of production are not what they were 13 years ago. In fact,
they are 30 to 40 percent higher. Our farmers need a new farm
bill with a strong and reliable Farm Safety Net to support
producers amidst fluctuating market conditions, natural
disasters, and skyrocketing production cost. The $10 billion in
economic assistance Congress passed in December, was crucial
lifeline to keep some producers afloat, and we need to ensure
it is implemented quickly.
Mr. Duvall, in your testimony, you discussed the importance
of extending the expiring provisions of President Trump's 2017
Tax Cuts and Jobs Act to keep farmers in business. Can you
discuss the tax provisions that our producers rely upon the
most?
Mr. Duvall. Yes, sir. I can. One it provided for a reduced
tax rate. Most of our farmers are--98 percent of them are
operating on our pass-through entities. That is important to
them. Section 199A is important to them very much because it
preserves a 20 percent business income deduction. Section 179
also needs to be continued. It is called bonus depreciation. It
allows our farmers to reinvest in their business so they can
meet the goals that country has for us, whether it be
conservation, climate, whatever it might be, soil health. We
have to have that bonus depreciation.
Then of course, the last one when we spoke about young
farmers and the beginning farmers. Estate taxes. Estate taxes
need to be eliminated. It needs to be eliminated so that we can
continue to pass our farms on for generations to come and make
sure we bring stability to our system, our food system. This is
something people sweat, blood from to pay for. It is their
land, their home, and they want to keep it in production. There
is so many pressures on that land staying in production. It is
just unreal. This pressure makes it unbelievable when a family
person dies and you have to sell part of the farm to pay the
taxes. What does that do? It takes it out of production, puts
it into houses, or solar panels, or whatever, and it never
comes back to agriculture.
Senator Tuberville. Bonus depreciation. Estate taxes. My
phone rings off the wall and we need to listen to it, and I am
sure the rest of the Senators are the same. Mr. Duvall, the
agriculture trade deficit I just said it is $45.5 billion. It
is shameful. America has the best farmers and producers in the
world. What suggestions do you have to improve agriculture
trade and close the gap?
Mr. Duvall. We got to have new agreements. We got to open
up the market. We can compete with anybody in the world as long
as we are allowed to use innovation and the research that are,
that is coming to our farms. It keeps us on cutting edge. As
long as our farmers are led by voluntary market-based programs,
we will do anything this country asks us to do if it is led in
that direction. We have proven that in conservation by putting
over 140 million acres into conservation over the last few
decades. That is the size of California and New York State
together.
Senator Tuberville. Thank you. Thank you, Mr. Chairman.
Chairman Boozman. Senator Schiff.
Senator Schiff. Thank you, Mr. Chairman. I think everyone
in this room can agree that American farmers today face deeply
difficult challenges; from extreme weather events, never-ending
labor shortages, and a looming trade war, just to name a few.
These challenges come on top of a job that is inherently
demanding and at times unforgiving.
It is Congress' job to ensure that when farmers are faced
with the worst-case scenario, they have the tools to weather
the storm and eventually rebuild. That is why Congress invests
billions each year in Federal crop insurance and disaster
assistance programs. While traveling throughout California, I
have learned that many of our growers simply are not eligible
for the insurance or assistance that they need. California
farmers are incredibly resilient, but they deserve our full
support as well.
Mr. Larew, can you speak to the challenges that specialty
crop growers face when it comes to accessing Federal programs?
Perhaps you both could address what steps you think Congress
should take to expand access to risk management options for
these particular growers?
Mr. Larew. Well, first of all, I might start with just the
investment that has been really appreciated over the years by
our specialty crop growers in research for not only opening up
new markets, but also making sure that we are managing pest
pressure and so forth. That has been a really important
investment that we would want to make sure continues going
forward.
It is absolutely true that the current risk management
tools are really limited for these high value crops. It just
does not often make sense even when there is a policy
available. I do think whether it is growers in the Central
Valley, or it is fruit and vegetable growers across the country
looking for additional ways to improve existing programs to
make it work better for especially to crop growers is going to
be an important part of making sure that all of our producers
can manage their risk.
Mr. Duvall. Yes, and I agree with Rob here, and I will
reiterate that any farmer out there that is putting a crop in
the land, and depending on the good Lord, to giving you things
to grow it with and with the markets like they are, deserves to
have some risk management program.
Now, the difficulty comes of making it very complicated.
The smaller the farm it is, the more complicated, it is more
difficult it is to do, it needs to be simplified for those
people. A lot of people just not going to go do it because it
is just too difficult. They are in the field working, and these
are a lot of these farm-to-table, farm-to-market people. They
deserve a shot to be able to have that risk management, too.
Senator Schiff. Well, I appreciate that very much. I was
visiting citrus growers in the Central Valley just this past
weekend. We talked about a number of issues including the one I
raised. We also talked about how California citrus groves are
being affected by the bacterial infection called HLB. This has
obviously been devastating to citrus growers in Florida and
elsewhere.
It was interesting for me to learn about the work that is
being done, the research that is being done, the investment
that is being made in a certain species of wasp that is a
natural predator to the insects responsible for spreading this
disease. This is a great part of the solution. I wonder if you
both could address how investments in agriculture research are
also key to making sure that the farming community succeeds.
Mr. Larew. Yes, sir. Whether it is through our land grade
institutions or through USDA agencies themselves, it may be
safe to say we cannot over invest in research. I think you just
hit on a couple of key points to drive home. That is not only
those kinds of existing pests, but emerging threats as well.
Whether it is looking for ways to combat that and making sure
that we are innovative in our approach. That investment's
critically important, and making sure that we are removing
barriers wherever possible.
Mr. Duvall. Totally agree with what he had to say,
everything he said. You know, the alarming thing to me is if we
look around the world in comparisons to China, they are
spending $3 to our $1 in research and development. Research and
development, and innovation keeps us on the cutting edge and
being able to keep our food system supply secure.
Senator Schiff. Well, I thank both you, gentlemen. Mr.
Chairman, I look forward to working with you to make sure that
the specialty crop farmers can access insurance and assistance,
that we keep the marketing programs strong and well-funded, but
that we also continue that investment in research. We could
easily lose billions to these bacteria. Millions in research to
save billions in crops is a really good investment. I thank
you, Mr. Chairman, and yield back.
Chairman Boozman. No, thank you. Those are excellent
points. Okay, good. Thank you all for being here. This has been
excellent. Let us take a second and get our second panel up.
You guys are discharged.
Mr. Duvall. Can we say thank you, again?
Chairman Boozman. Yeah, thank you.
Chairman Duvall. Thank you very much, and all of you, you
are invited to our national convention next year in Anaheim to
celebrate a new farm bill that you are going to pass.
Chairman Boozman. Very good.
[Recess.]
Senator Hoeven. [Presiding.] Okay. Let's rock and roll. Or
as our Chairman would say, the Committee will now reconvene. I
am going to start with an introduction, and then I am going to
call on Senator Tuberville for an introduction, and then
Senator Moran. By that time, Chairman Boozman likely will be
back.
We have got a quorum call going on right now. I think we
have established the quorum, so hopefully that is covered. Then
we do have another vote, and actually we have the Vice
President coming up, who is probably here by now, regarding
budget reconciliation, some other things. Just so you
understand, there is a lot going on right now. It is a little
chaotic, but that does not take away from how much we really
appreciate all of you being here. Your expertise is vitally
important. The commodity groups that you represent are
critically important, not just to our farmers and ranchers, but
our ability to make good farm policy here. Thank you so much
for taking the time, and making the effort to be here. We want
you to know how much we appreciate all of you.
I am going to start out with introducing Josh Gackle, who
is chairman of the American Soybean Association. Now, he
actually farms near Kulm, which is fairly famous because it is
the hometown of Angie Dickinson, although now maybe it is more
famous for Josh Gackle. I do not know. I think he should live
in the very nearby town or farm closer to the very nearby town,
which is Gackle, North Dakota. He is closer to Kulm. Obviously,
grows soybeans, 2,800 acres of soybeans, but also corn, wheat,
and barley. He, for eight years, led the North Dakota Soybean
Growers Association, and did an outstanding job. He is doing an
outstanding job as chairman of the American Soybean
Association.
I actually had him at a field hearing at Grand Farm, which
is near Fargo, North Dakota. Our great Chairman, Senator
Boozman, came out for as well as the Ranking Member, Senator
Klobuchar, and also Senator Tina Smith, who is on this
Committee as well. Josh testified, did a great job, and
appreciate so much you being here, again, and all your work on
behalf of your fellow farmers.
With that, I would like to turn to Senator, Coach
Tuberville.
Senator Tuberville. Thank you, Assistant Chairman, I guess
you would call it. Soybeans in North Dakota.
Senator Hoeven. Yes, Cass County's the number one county
for soybeans in terms of volume of soybeans growing in the
country. More than even Alabama.
Senator Tuberville. I have never been invited up there.
Senator Hoeven. Well, you are invited. You are invited
right now.
Senator Tuberville. Thank you. Today, I am proud to
introduce Mr. Garrett Moore from Chancellor, Alabama. Garrett's
a proud fourth generation farmer in Alabama's Wiregrass Region,
which is the Southeastern part of the State. He is also a proud
veteran of the U.S. Marine Corps, having served as an
infantryman for four years, some of that overseas in Japan and
near the DMZ of South Korea.
After completing his military service, Garrett wanted to
return to his roots and farm in LA, that is Lower Alabama. He
currently farms nearly 1,500 acres of peanuts, cotton, corn,
and cattle with his father across Southeast Alabama. Garrett is
chairman of the Coffee County Young Farmers Association,
Alabama Row Crop Farmer of the Year recipient, and part of the
Southern Peanut Farmers Leadership Academy. I am grateful for
the hard work Garrett has done to produce food and fiber for
Alabama, and advocate for our young farmers, and also being an
Auburn Tiger fan, War Eagle.
Garrett, thanks for being here today.
Senator Hoeven. Thank you, Senator Tuberville. Senator
Moran, from the great State of Texas--Kansas.
[Laughter.]
Senator Moran. They are both great States, but one is
better than the other.
Good morning. I thank the Chairman for allowing me the
opportunity to introduce a Kansan who appears with all of you
on this panel. Amy France is a native of Leoti, Kansas.
Population 1,475. Made me think of Hee Haw, salute my hometown.
You all are too young to remember Hee Haw. I watched RFD TV on
Sundays and Saturdays. That county that Leoti is in is Wichita
County and population 2,152.
My point is that Amy lives in a very rural part of Kansas.
She found a love. She did not grow up on a farm, but she found
a love for this industry called agriculture. After meeting her
husband, Clint, together they operate the French Family Farms
near Scott City, growing sorghum, corn, and wheat, and raising
cattle with their children and grandchildren, farming alongside
her family, five children and two grandchildren. Her family's
been a priority for Amy, and she has been instilling--and I
have met her children--instilling Kansas values in her children
and an understanding of what it means to be good stewards of
their land.
They share the produce that they grow on their farm with
their community. Amy has stated how she is focused on being,
``A better farmer, not just a bigger farmer.'' Amy has long
been a leader in agriculture with her roles on the Local Farm
Bureau Board, and the Young Farmers and Ranchers Committee of
Kansas Farm Bureau. She is also the first woman elected to the
National Sorghum Producers Board of Directors. She is a leading
voice for our Nation's Sorghum Producers. That culminated in
her appointment as chairwoman of the National Sorghum Producers
just this last August.
She also worked at the First National Bank in Scott City.
That is the area, big town population 3,931. She worked there
for a decade giving her a background in Kansas Community
Banking and insight, how those two relate, how that relates to
agricultural lending, and how we strengthen family farms with
this market uncertainty, high production costs, the drought we
have had in our State. Amy's consistent advocacy for disaster
relief and crop loss assistance has made her a key voice for a
fight for a better agricultural economy.
Mr. Chairman, I thank you for conducting this hearing, and
I thank you, Amy, for fighting for our nation's sorghum
farmers. Thank you.
Senator Hoeven. Thank you. Senator Moran, from the great
State of Kansas.
Senator Moran. Thank you, Mr. Chairman, of South Dakota.
[Laughter.]
Senator Hoeven. We go back and forth as to who is the
number one wheat producing State, Kansas, or North Dakota, on a
regular basis. We work together a lot.
Okay. Let me acknowledge all of our witnesses here today
again. I do want to thank you for being here on this panel. We
have Mr. Nathan Reed, who is the on the Board of Directors for
the National Cotton Council from Marianna, Arkansas. Thanks for
being here. Mr. Kenneth Hartman, Jr., President of the National
Corn Growers Association. Good to visit with you yesterday in
my office. Thank you for being here. He farms near Waterloo,
Illinois.
Mr. Keeff Felty, thanks for being here. President National
Association of Wheat Growers, from Altus, Oklahoma--not North
Dakota, Kansas. Now, we have been all that bragging about our
wheat. Are you close to the Kansas border?
Mr. Felty. No, I am in southwest Oklahoma.
Senator Hoeven. Oh, okay. Mr. Chris Engelstad, President of
the National Barley Grows Association, from Fertile, Minnesota.
Good to have you here. Certainly, know where that is. Ms. Amy
France, Chair of the National Sorghum Producers, Scott City,
Kansas. Of course, Josh Gackle, who I introduced a minute ago.
Mr. Garrett Moore, member of the U.S. Peanut Federation
from Chancellor, Alabama, as we heard. Mr. Tim Deal, Vice
President of the American Sugarbeet Growers Association from
Doran, Minnesota. That leads us to Mrs. Jennifer James, Board
of Directors, USA Rice, Newport, Arkansas. I know how excited
our Chairman is to introduce both you and Mr. Reed and I see
how he is bookended this deal, which does not surprise me a bit
because he is the guy that knows how to cover all the bases.
With that, I would turn back to our Chairman, Senator
Boozman.
Chairman Boozman. [Presiding.] Thank you, Senator Hoeven,
very much for your help.
Senator Hoeven. I did mention that inadvertently that I
said--when I introduced Senator Moran, I said the great State
of Texas. Inadvertently, I was thinking about my wife. She is
from Texas, and I think he is still a little upset about it.
Hopefully----
Chairman Boozman. I bet.
Senator Hoeven [continuing]. you can give him some special
dispensation as a result.
Chairman Boozman. I bet. Being from Arkansas, I understand
why he would be upset if he was introduced from Texas.
[Laughter.]
Chairman Boozman. Let me just introduce the, again, add a
little bit extra to our Arkansas folks. Nathan Reed, a great
Arkansan hailing from Marianna, located in the heart of the
Mississippi Delta Region. Nathan and his wife, Kristen, and
their four wonderful children grow cotton, rice, corn, and
soybeans. Nathan currently serves on the Board of Directors for
the National Cotton Council. Back in Arkansas, he serves as an
Executive Officer with the Arkansas Agriculture Council, and
serves on the Arkansas Plant Board, which is a thankless job.
Over the years, I have had the pleasure of getting to know
Nathan, listening to his experience and challenges that he
faces, he and his family. You will find him to be resourceful,
resilient, and a wealth of knowledge when it comes to farming.
I look forward to hearing his testimony as he represents farm
families across the cotton industry. Again, thank you, Nathan,
for making the trip.
Jennifer James. We are very honored to have her. Jennifer's
a fourth-generation farmer from Newport, as was mentioned
earlier, Arkansas, where she and her husband, father, and son,
grow rice, corn, and soybeans on their century farm. As an
active member of USA Rice, she serves on the Farmer's Board of
Directors, the Farm Policy Task Force, and a number of other
committees within the organization.
Jennifer's many accolades are a small testament to her
impressiveness as a farmer. She has been recognized as the 2017
Field-to-Market Farmer of the Year, the 2019 USA Rice Farmer of
the Year, the first-ever woman elected to serve on the Riceland
Board of Directors, and 2023-2024 Outstanding Alumni of the
University of Arkansas, Dale Bumpers College of Agricultural
Food and Life Sciences. She has also lent her expertise on the
EPA Agency's Farm, Ranch, and Rural Communities Federal
Advisory Committee. Also, we look forward to your testimony and
thank you for being here.
Thank all of you for being here. One of the things that I
thought was really important, Senator Klobuchar and I thought
was really important----
Senator Klobuchar. Yes, we did.
Chairman Boozman [continuing]. was trying to establish the
fact that the situation that the farm community's in right now.
That is really why we wanted to get you here, and we look
forward to your telling us what is going on in the farm, the
challenges that you face, so that we can continue to try and
figure out working together. The nice thing about agriculture
is it is not about Democrats and Republicans. It is very
bipartisan trying to figure out a path forward with some of the
challenges that you all are going to be talking about and some
of those that were expressed by our two previous witnesses.
Let's start with you, Nathan.
STATEMENT OF NATHAN REED, BOARD OF DIRECTORS, NATIONAL COTTON
COUNCIL, MARIANNA, ARKANSAS
Mr. Reed. Well, thank you. I want to thank the Committee
for the opportunity to testify and share our story.
I am Nathan Reed from Marianna, Arkansas. My wife, Kristen,
and I farm 9,200 acres of cotton, corn, soybeans, and rice. I
am blessed to farm in the Arkansas Delta, where we produce high
quality cotton with yields that surpass many areas of the
cotton belt. Despite vast technological improvements, it is
impossible to yield our way out of this current economic
crisis. I have grave concerns about what the future holds for
me and for other farm families across the country.
I personally know producers who have spent their entire
lives farming, but may not be able to secure operating loans
this year. My equity is depleting every year. My children love
growing up on the farm, and one day I would love nothing more
than for them to join me in this business just as I was able to
join my father. Unfortunately, considering the current economic
climate, it is hard to imagine such a possibility.
Our industry understands that we must look inward to
address many of the current challenges. There are some problems
that congressional leaders may not be able to solve. We must
work with the companies that supply our inputs to get
production costs more in line with our global competitors. We
must also find innovative ways to increase the demand for U.S.
cotton.
We are grateful to Congress for providing the $31 billion
in economic and disaster assistance for producers this
December. We must recognize that even timely delivery of
economic relief may not be enough to save some producers. To
prevent farms from failing, producers need the multi-year
certainty that only a new farm bill can provide. We must ensure
that any new legislation will take effect in the 2025 crop
year.
I commend Chairman Boozman for offering a farm bill
framework that addresses many of the National Cotton Council's
top priorities by advocating for a significant increase in the
PLC reference price, and improved access to individual and
area-wide crop insurance products. We hope that the next farm
bill will also modernize USDA's marketing assistance loans for
both upland and pima cotton, and provide increased support for
the U.S. textile industry.
I would like to thank Chairman Boozman for recommending
increases to commodity title payment limits. A higher PLC
reference price would likely do more than any other single farm
bill reform to reassure farm lenders. Cotton costs of
production today are roughly 25 percent higher than support
levels are in the 2018 Farm Bill. The bankers I speak with do
not want to rely on last minute temporary aid from Congress.
Instead, we all want long-term solutions.
In closing, my wife, four children, and I, live and work in
the Arkansas Delta where agriculture is the lifeblood of the
local economy. Any of us who are parents know the obligation we
have to protect and provide for our family. If Congress does
not act quickly to provide an adequate safety net, I will be
forced to answer a few very difficult questions; am I putting
my family's future at risk by continuing the tradition of
farming? What happens to my local community without the
backbone of agriculture? Perhaps an even bigger question, what
happens to our country if we lose our ability to produce the
food and fiber we need? That is not an exaggeration. It is
questions that I and many others producers are asking.
Thank you for the opportunity to testify, and I would be
pleased to respond to any questions.
[The prepared statement of Mr. Reed can be found on page 75
in the appendix.]
Chairman Boozman. Thank you. Mr. Hartman.
STATEMENT OF KENNETH HARTMAN JR., PRESIDENT, NATIONAL CORN
GROWERS ASSOCIATION, WATERLOO, ILLINOIS
Mr. Hartman. Thank you. My name is Kenneth Hartman, Jr. I
am a fifth-generation farmer from Waterloo, Illinois, where my
family, and I, including one of my daughters, operates a grain
farm. I am serving as President of the National Corn Grows
Association. Today, I would like to focus on challenges in the
farm economy, the need for a strengthened farm bill, and
additional actions in Congress that can take this year to
support corn growers.
The United States is a corn producing superpower growing
about one-third of the corn in the world. Despite record
setting productivity, the value of corn production has dropped
substantially, but costs have not. The average corn price
farmers receive in the market has declined by 40 percent from
2022 to now. Comparatively, the average cost to produce corn
has only declined by just six percent.
A major component of the cost of production of corn is
fertilizer, representing about one third of the operating cost.
Although fertilizer prices have declined from 2022's peak,
costs remain relatively high. An average American corn farmer
is facing losses over $160 per acre of corn for their crop year
2025 coming on following losses over $100 per acre in both 2023
and 2024.
Sustained high input costs and dropping commodity prices
leave American farmers in a vulnerable financial position. Corn
growers appreciate those who work hard to include an
agriculture provision in the American Relief Act. We are
working to ensure that the timely implementation of economics
and disaster assistance programs. Once the aid is received, it
will be appreciative of by growers, particularly by those who
have faced steep financial strains from the recent years of
crop and revenue losses.
As we look ahead, further action is needed to improve the
Farm Bill Safety Net Programs, and market outlook. Corn growers
are disappointed that the solution for nationwide year-round E-
15 was ultimately not included. It would come at no cost to the
Federal Government and would boost the corn economy. We
appreciate the champions on Capitol Hill, including Senators
Fischer, Klobuchar, and Ernst, and several Members of this
Committee who continue to lead on this important issue.
As a grassroots association, we have worked to prioritize
policy recommendations for a farm bill. Our priorities include;
protecting Federal crop insurance, strengthening the producer
safety net, bolstering U.S. international markets and
development efforts, supporting voluntary conservation
programs, and championing initiatives important to Rural
America.
Many of these priorities reflected in the Senate framework
that was released last year. A new farm bill with improved
safety net programs is overdue. Congress can strengthen
existing USDA programs through strategic investments and policy
enhancements. NCGA would like to see this process move forward
in a bipartisan manner for a farm bill to be signed into law as
soon as possible.
NCGA recently released a report where we identified six key
targets for enhancing competitiveness of corn. These actions
include developing new foreign markets, expanding consumer
access to higher blends of ethanol, fueling innovations in a
new uses research, ensuring sensible regulations, and extending
key Federal tax provisions. This is a roadmap to establish an
environment in which farmers can be innovative, productive, and
profitable.
In closing, we would look forward to working with you to
confront the current and engaging issues impacting businesses,
families, and rural communities.
Thank you for your support of the American Farmer.
[The prepared statement of Mr. Hartman can be found on page
80 in the appendix.]
Chairman Boozman. Thank you, sir. Mr. Felty.
STATEMENT OF KEEFF FELTY, PRESIDENT, NATIONAL ASSOCIATION OF
WHEAT GROWERS, ALTUS, OKLAHOMA
Mr. Felty. Chairman Boozman, Ranking Member Klobuchar, and
distinguished Members of the Senate Agriculture Committee,
thank you for the opportunity to testify, provide a wheat
producer perspective on the agricultural economy.
My name is Keeff Felty. I am a farmer from Altus, Oklahoma,
where my family and I farm wheat, cotton, and pasture land. In
addition to being a fourth-generation farmer, I currently serve
as the President of the National Association of Wheat Growers.
NAWG is a federation of 20-State wheat grower associations.
Today's hearing is important as the Committee works to
reauthorize the farm bill and address the challenges facing the
agricultural economy.
As I enter my 40th year in farming, the agriculture economy
is facing a severe downturn, the likes of which we have not
seen since the early 1980's. NAWG greatly appreciates the hard
work that leadership and Committee Members played in getting
economic and disaster assistance signed into law this past
December. That assistance is much needed across all of
agriculture. However, long-term improvements to the Farm Safety
Net must be included as the Committee and Congress work to
reauthorize the farm bill this year.
In September, most organizations at this table were in
Washington, DC for the first ever multi-commodity fly in where
we highlighted the financial pressure building across American
agriculture, and urged Congress to pass a robust farm bill that
strengthens the Farm Safety Net. The challenges facing
agriculture today differ from when the 2018 Farm Bill was
enacted. While the Farm Safety Net is a sound network, it must
be enhanced to reflect today's realities, increased input cost,
high interest rates, and depressed commodity prices have
created significant challenges for farmers in Rural America.
In December, the USDA reported farm sector income is
forecasted to fall in 2024. When looking at the commodity level
changes in farm income, wheat growers experienced a 43 percent
decrease in net cash farm income from 2023 to 2024 that marks
the lowest level in the last 15 years. These conditions
underscore the need for a strong, robust, and meaningful farm
bill that provides long-term certainty as we proceed into the
119th Congress.
Crop insurance is the cornerstone of the Farm Safety Net. I
use crop insurance on my operation to cover natural disasters.
Last year, one week before harvest, our operation saw a
devastating hailstorm that destroyed wheat that was otherwise
in excellent condition. Crop insurance is a vital component
that ensures the viability of my operation, and is the first
line of defense against natural disasters. We must work to make
crop insurance more affordable as it plays the vital role in
sustaining Rural America.
Additionally, the PLC reference price for wheat has
remained unchanged and has fallen far short of the cost of
production since its introduction. Since the 2018 Farm Bill
crop inputs have increased by about 30 percent on average. When
our past President testified on this topic in 2023, he stated,
``Wheat farmers across the country are currently experiencing
high prices, but at an extreme risk.'' Since then, wheat prices
have dropped 37 percent.
In 2025, the USDA forecasts cost of production to remain
elevated at $386 per acre, which means wheat growers are
projected to lose $96 per acre. NAWG requests the Committee
make a meaningful investment in the Farm Safety Net and
increase the reference price for wheat. Wheat growers in the
United States pride themselves in growing a safe, abundant, and
sustainable crop that we consume here at home and export
globally.
Thank you for the opportunity to testify today, and I look
forward to your questions and working with you on the next
forma.
[The prepared statement of Mr. Felty can be found on page
95 in the appendix.]
Chairman Boozman. Thank you. Chris.
STATEMENT OF CHRIS ENGELSTAD, PRESIDENT, NATIONAL BARLEY
GROWERS ASSOCIATION, FERTILE, MINNESOTA
Mr. Engelstad. Thank you, Chairman Boozman, Ranking Member
Klobuchar, and Members of the Committee for hearing us today.
My name is Chris Engelstad, I am the President of the
National Barley Growers Association. I am a fifth-generation
farmer in northwest Minnesota. I farm with my parents and my
wife Maddie, and we have a one-year-old daughter, Cameron.
Needless to say, my family has a lot at stake with the U.S.
agriculture economy. As President of the National Barley
Growers Association, I represent the perspectives of producers
in all the barley growing regions, which is predominantly the
Northern Plains, including Minnesota, North Dakota, Montana,
Idaho, and Washington, as well as Wyoming, and Colorado.
On behalf of the barley growers, I want to thank you for
the Committee's attention to the challenges facing farmers, and
for the assistance enacted by Congress in December aimed at
mitigating the losses incurred in 2024, and improving the
grower's ability to get financing to plant their crops in 2025.
We want you to know that these actions are very much needed and
very much appreciated. As you are aware, and I am sure it will
be reflected in many of these statements here today.
U.S. farm income has declined for the second consecutive
year in 2024, and projections for 2025 and beyond are not
favorable. USDA reports a 22.6 percent decline in net farm
income from 2022 to 2024, and receipts for some crops have
plummeted over 40 percent. The trends and outlook for barley
are concerning.
The depressed market for barley has resulted in farmers
having to hold barley for as long as a year or 18 months before
the buyers can even take delivery. Planted acres and production
are down significantly. In 2024, barley production was down
nationally 19 percent, while production in Montana was down 16
percent, North Dakota was down 48 percent, and in my home State
of Minnesota was down an alarming 66 percent. The projections
going forward are not good either, as a recent publication by
North Dakota State University Extension projects barley prices
in North Dakota for the next five years will be below the five-
year average from 2019 to 2023.
As prices are declining, production costs are increasing.
From 2019 to 2023 barley in particular has increased 23
percent. Production costs have leveled off some in recent
years, but still has not come back to where it's toward cost
effective. I'm a relatively young farmer and addressing the
challenges and barriers for new farmers, that has been an
ongoing concern that the agriculture community and policymakers
have been grappling with. In times like these, when it is
difficult to just be cash positive for the year, new and young
farmers cannot build equity or gain access to capital to
improve their operations.
The situation for barley is especially concerning as we are
losing crop diversity and crop rotation options. As barley
production declines, we are also losing barley processing
infrastructure. Loss of that infrastructure will make it more
difficult for the production return, even if the market
conditions improve in the future.
With all the challenges we are facing, it is vital that
Farm Safety Net and Risk Management Programs will be maintained
and strengthened. Our top farm bill priorities include
enhancements to the crop insurance as reflected in the FARMER
Act, introduced by Senator Hoeven in 2024, and improvements to
farm bill Title I programs, including an increase in the
reference prices under the PLC Program. We hope that a new farm
bill can be enacted this year, and that bolsters the safety net
for farmers under National Food Security.
We also want to take this opportunity to share perspectives
on the potential for disruptions to markets due to tariffs and
trade disputes. We are proud and appreciative of the domestic
beer producers, both large and small, utilize American grown
barley almost exclusively. U.S. farmers can also produce more
than enough barley to meet domestic demand, and barley growers
and consumers benefit from exports of barley to Mexico, which
is their top export market. Mexican beer producers purchase
U.S. barley and produce their brand, then they are exported
back to this country for U.S. consumers. Growers, companies,
and consumers benefit from a smooth tariff free flow of goods,
and we urge support for policies that promote fair and
beneficial trade between U.S. and Mexico.
Thank you, again, for the opportunity to testify today and
provide our perspectives, and for your continued support for
American farmers. We also hope you can join us this evening. We
have a reception in the Cannon Caucus Room called the Barley
Brews and Boots Reception with the Beer Institute and industry
partners, and we will have a wide selection of beers made with
a bunch of U.S. barley.
Thank you.
[The prepared statement of Mr. Engelstad can be found on
page 108 in the appendix.]
Chairman Boozman. Very good. Thank you.
Mr. Engelstad. Absolutely. All is welcome.
Chairman Boozman. Yes. Amy.
STATEMENT OF AMY FRANCE, CHAIR, NATIONAL SORGHUM PRODUCERS,
SCOTT CITY, KANSAS
Mrs. France. Thank you, Chairman Boozman, and Ranking
Member Klobuchar, for the opportunity to testify today.
My name is Amy France, and I farm alongside my husband and
our oldest son. We raise grain, sorghum, corn, and wheat, and
black Angus cattle in the best State of Kansas. I serve as the
Chair of National Sorghum Producers, and I am honored to
represent many family farms here today. My 12 years in rural
banking industry and firsthand experience with the very real
financial challenges of farming in the current environment have
allowed me to develop an in-depth understanding of the
importance of economic stability for farmers.
The current problem is quite easy to sum up. We are facing
weaker crop prices, high cost to production, and a stubborn
weather pattern that has been brutal. This has made me even
more appreciative of the work that this Committee so carefully
does, and we need to finally get a stronger Farm Safety Net in
place.
Many row crop farmers have been operating under bleak
economic landscape, and projections for the coming years have
not improved. In normal years, farming is a high stakes model
within margins. Right now, we are bleeding resources and
capital, and we simply could not survive without assistance
from Congress.
Sorghum is an important staple crop grown in harsher
environments due to its efficiency and resilience.
Unfortunately, drought has gripped 71 percent of the sorghum
makers in 2023 and 2024, and these years are also among the
hottest on record.
While sorghum is tough and water efficient, it is not
weather immune. Many farms have experienced diminished
production. On top of all of this, since 2019, cost of
production for sorghum has increased by an average of eight
percent year over year. In 2024, sorghum farmers lost roughly
$178 per acre, resulting in a loss of $1.5 billion in net farm
income.
From a farmer's perspective, 2025 appears to be just as
grim, if not more so. Disaster and economic assistance have
been a lifeline, bridging short-term gaps for farmers, many of
whom would not have otherwise been able to continue farming. We
thank you for that. However, we need to move beyond short-term
ad hoc relief. Farmers desperately need the improved long-term
stability only a multi-year farm bill provides, with
predictability and certainty for producers and lenders alike.
PLC reference prices are our highest priority, and they
need to be raised to account for cost starting in 2025 and
beyond. Additionally, we recognize the critical role ARC
programs play the proposed improvements in the program
introduced in the 2024 House Agriculture Committee last year
provided meaningful improvements with a higher base reference
price and expanded band of coverage. Updating and strengthening
Title I program for farm families is absolutely essential, and
I look forward to working with this Committee toward that
critical goal.
While Title I is critical to provide assistance when market
returns are below the cost of production, crop insurance is the
cornerstone of tailored in-season risk management for our
farmers. NSP supports higher coverage and cost assistance for
SEO, and we support Senator Hoeven's bill to help close
deductibles by incentivizing higher levels of coverage.
With that, I do need to mention quick two things for
consideration. First, ratings must be reviewed to ensure we are
not driving planting based on insurance. Second, along the same
lines, NSP recommends establishing a floor price election for
sorghum at no less than for corn.
I thank you very much for this time. I appreciate all of
the work that you put into this day in and day out. I look
forward to getting a farm bill in 2025. Thank you.
[The prepared statement of Mrs. France can be found on page
112 in the appendix.]
Chairman Boozman. Thank you very much. Josh.
STATEMENT OF JOSH GACKLE, CHAIRMAN, AMERICAN SOYBEAN
ASSOCIATION, KULM, NORTH DAKOTA
Mr. Gackle. Good morning, Chairman Boozman, Ranking Member
Klobuchar, Senator Hoeven, and distinguished Members of the
Senate Agriculture Committee. It is an honor to join you today
to testify on behalf of the American Soybean Association
regarding producers' perspectives on the agriculture economy.
My name is Josh Gackle. I am a soybean farmer from North
Dakota. I also have the privilege of serving as Chairman of the
American Soybean Association this year. We represent U.S.
soybean farmers across 30 main soy producing States.
For U.S. soybean farmers, there are many unknowns ahead.
Commodity prices are down nearly 50 percent from highs
experienced three years ago, and farmers still face elevated
prices for land, seed, fertilizer, pesticides, and other
inputs. Many threats and challenges are market-driven, but
Congress has significant opportunities to impact either
positive or negative farmers' concerns.
My full written testimony offers six policy recommendations
for the Committee to consider, but I will briefly cover the
major issues our industry faces today. Soybeans are our
country's largest export commodity, and farmers are deeply
concerned about growing threats to soy markets both at home and
abroad. Just this weekend, the administration announced tariffs
now delayed for 30 days that if ultimately put into place, will
cause an unnecessary trade war with Mexico, Canada, and China,
three of our largest agriculture trading partners, and I want
to emphasize the U.S. soybean industry is still dealing with
long-term negative impacts from the last trade war in 2018.
Retaliatory tariffs from additional actions taken by the
U.S. could threaten foreign market access even further.
Compounding matters, South America's soybean producers are
primed to meet any international demand resulting from new
trade disruptions, and U.S. exports could be permanently
replaced.
When threats arise in our export markets, U.S. producers
look to domestic markets to cushion the blow. However,
uncertainty surrounds Federal policy, impacting domestic
markets for soybean oil, both for food use and biofuel
production.
Increasing rhetoric is perpetuating unfounded claims about
supposed detrimental health impacts of soybean oil and other
seed oils. That false narrative and threats to ban these
products from domestic food use raise questions about U.S.
soybeans farmers continued access to this market. Removal of
the edible oils market would cause an immediate and significant
decline in soybean oil prices. Domestic biofuel production
offers opportunities for growth if policies related to the
renewable fuel standard and the 45Z clean fuel production
credit are supported and shaped to enhance the role that U.S.
agriculture plays in fueling America.
When the biofuel industry was poised for an exciting moment
of expansion, lower than anticipated RFS volume obligations
stunted growth triggered a decline in the price of RINs and led
to biofuel production facilities closing in the Midwest.
Further delayed guidance on the 45Z tax credit, paired with a
calculation system that currently affords higher credit prices
to non-agriculture feed stocks added additional downward
pressure on soybean oil prices. High levels of non-agriculture
feedstock imports have displaced domestic soybean oil and
biofuels, an issue that we will continue to face without needed
policy changes.
Access to pesticides remains a threat to U.S. farmers. As
the Environmental Protection Agency continues reviewing uses
and new approvals. EPA's Pesticide Program faces major
challenges and very few products have been approved over the
past several years. In addition, proposed restriction on legacy
products threaten to take away vital tools that growers have
used responsibly in their operations for years. Pesticide
prices are also elevated, and the price tag could increase even
more with tariffs and any resulting trade disruption.
Finally, a new farm bill is long overdue. As I outlined in
my written testimony, the economic situation facing farmers is
dire. The 2018 Farm Bill did not meet the needs of soybean
farmers during the trade war. ASA appreciates the work that
this Committee has done laying the groundwork for a new farm
bill, and we recognize the political intricacies involved in
completing a bill this year.
However, for farmers, the need is great, and the time is
now, and I strongly encourage the Committee to work in a
bipartisan manner as quickly as possible to move a new farm
bill forward. One that meets the needs of farmers, ranchers,
and consumers.
In conclusion, U.S. soybean farmers continue to face
threats and uncertainty, but Congress can help shape policies
that bolster soy and all of agriculture passing a comprehensive
five-year farm bill, and supporting programs that encourage
growth throughout the agricultural value chain, and blocking
harmful policies that restrict market access at home and abroad
will result in economic footing for all rural economic footing
for all of Rural America.
On behalf of ASA, thank you for the opportunity to testify
today and provide soybean industry's perspective on the farm
economy. We look forward to working with you to shape farm
policy in the 119th Congress, and I look forward to any
questions. Thank you.
[The prepared statement of Mr. Gackle can be found on page
118 in the appendix.]
Chairman Boozman. Garrett.
STATEMENT OF GARRETT MOORE, MEMBER, U.S. PEANUT FEDERATION,
CHANCELLOR, ALABAMA
Mr. Moore. Chairman Boozman, Ranking Member Klobuchar, and
Members of the Committee, thank you for the opportunity to
appear before you today to provide the peanut producer's
perspective on the agricultural economy.
My name is Garrett Moore. I am a fourth-generation farmer
and marine veteran from Chancellor, Alabama, where I operate
and own Moore Family Farm. I am honored to represent the U.S.
Peanut Federation today. I have witnessed my family's many
struggles on the farm over the past 29 years, and I have had
heard stories from before I was born that impacted generations
of my family.
Since 2020, we have seen supply chain disruptions,
inflation on key farm inputs, labor shortages. Prior to 2020,
the peanut industry was already experiencing difficult
variables such as low prices, much of which was a result of
trade issues, a reduced market in China, and non-tariff trade
barriers in the European Union. The EU is one of our premium
markets.
Since the 2018 Farm Bill, we have seen a substantial
increase in inflation. When comparing peanut farmers' 2021 to
2024 cost of production, the total cost increase was 20 percent
per ton. Prior to 2021, the peanut reference price of $535 a
ton provided an effective safety net for growers. However, the
reference price has not been a functional safety net since of
2021 crop year.
The American Relief Act of 2024 brought significant
reassurance to the peanut growers by including the agriculture
economic and disaster assistance due to economic conditions and
also impacts from natural disasters. In the past year, many
growers were facing a low probability of obtaining a loan for
their next crop year. These funds will assist growers in
obtaining financing for the 2025 crop.
The peanut industry is grateful to the Members of Congress
who worked to ensure this economic assistance was passed before
the end of last year. Unfortunately, there will still be a
deficit remaining for peanut farmers. With a current projected
return of negative $325 per acre, the farm is still going to
have a negative net return of $249 per acre after the economic
assistance.
Our farm alone, many of our expenses have almost doubled
since 2018. We are seeing no signs of relief in the cost of
production area. For example, we need specific fertilizer to
sustain nutrient levels in the soil both for the peanuts we are
growing and to protect the land for future crops. In the past
few years, this increase in fertilizer costs has caused for
tough management decisions.
This testament to our current farm economy clearly conveys
why we need a new farm bill. Peanut growers, shellers, and
buying points all support the PLC program as included in the
2018 Farm Bill, but with a reference price increase. While the
2018 Farm Bills PLC program has been beneficial for peanut
growers in the past, the rise in cost of production requires a
reference price increase if this program is going to remain
relevant and valuable as a Farm Safety Net.
Additionally, U.S. Peanut Federation supports a voluntary
base update that includes growers with and without peanut base
acres. While the 2014 Farm Bill allowed for base updating for
peanut growers that already had base acres on their farms, it
excluded many young farmers and new production areas.
I am proud to be an American peanut grower and I am
thankful for the opportunity to contribute to our nation's food
supply. I hope to continue my family's farm for the fifth
generation, which cannot be done without increased support for
our industry. Many of the witnesses today are current leaders
in agriculture. As a young farmer, I want to be a part of the
future of agriculture.
Thank you for allowing me to testify today.
[The prepared statement of Mr. Moore can be found on page
127 in the appendix.]
Chairman Boozman. Thank you. Senator Klobuchar.
Senator Klobuchar. Well, thank you. Two Minnesotans up here
in the panel. I know you already heard from one Mr. Engelstad,
and I just wanted to thank Chris so much for his work with the
National Barley Association. We are so proud of our barley in
Minnesota, and I am looking forward to asking you a question.
Now coming up Tim Deal, who Senator Smith already mentioned,
fourth generation farmer. He serves on the American Sugarbeet
Growers Association Board and serves as the Vice President. I
will also note that their farm is fourth to fifth generation,
right? Not to compete with Mr. Larew, but their farm was
homesteaded in 1879. With that, not 1700, so we do not win. I
turn it over to Mr. Deal. Thank you.
STATEMENT OF TIM DEAL, VICE PRESIDENT, AMERICAN SUGARBEET
GROWERS ASSOCIATION, AMERICAN SUGAR ALLIANCE, DORAN, MINNESOTA
Mr. Deal. Yes, I thought I had something there for a while.
Well, good afternoon, Chairman Boozman, and Ranking Member
Klobuchar, and the rest of the Committee Members. Thank you for
the opportunity to testify today on behalf of the American
Sugar Alliance.
I also want to express my appreciation to Chairman Boozman
and Ranking Member Klobuchar for your leadership and commitment
to advancing a five-year farm bill. We recognize the hard work
that has gone into it, this process, but it is critical that we
finish the job this year to provide farmers with the certainty
we need.
My wife, Kathy, and I grow sugarbeets on our family farm
with our son, Josh, and his wife, Beth, in Doran, Minnesota. I
am a fourth-generation farmer, and I am fortunate to be
transitioning our farm to the fifth generation. In addition to
farming, I am honored to serve as Vice President of the
American Sugarbeet Growers Association, and Chairman of the
Board of Minn-Dak Farmers Cooperative.
Sugar production is a cornerstone of our rural economy.
Eight members of this committee represent sugar producing
States, and two represent sugarcane refining States. You know
how vital this industry is to our communities. The U.S. Sugar
industry supports over 151,000 American jobs across two dozen
States, and contributes more than $23 billion annually to the
U.S. economy. Americans benefit from a safe, high quality and
reliable supply of sugar grown, processed, and refined right
here at home.
Our industry has built a strong resilient supply chain,
anchored in 90 strategically located distribution facilities
across the country. We take great pride in what we built and
great pride in producing a record crop this year. Pride,
Senators, does not pay the bills. This hearing is timely
because many farmers across the country, including sugar
producers, are struggling under tough economic conditions. What
we need most is a new five-year farm bill to provide certainty
for production decisions and financial management of our farms.
The farm bill represents a critical safety net for farm
families, mill employees, and processors across the country.
Sugar prices have fallen more than 10 percent over the past
year, and for years, tight margins have made it harder and
harder to stay afloat. Our story is even more complex because
our costs do not stop at the farm gate. As farmer-owned
cooperatives, we must also cover the expenses at our processing
facilities. We are operating under an outdated farm bill that
has not kept pace with the economic realities on the farm.
Consider this. The marketing loan rate for sugarbeets has
only increased $4.03 in 40 years, while the rate for raw sugar
has increased just $1.75 in that same amount of time. During
that time, 68 bean and cane facilities have closed. Outdated
policies put our producers at risk. Without meaningful
improvements, many growers will struggle to secure financing to
continue operating.
We strongly support the House Agricultural Committee Pass
Bill and the Senate Agricultural Committee proposals that would
increase loan rates to reflect actual production costs, raise
storage payment rates, modernize the beet sugar marketing to
improve efficiency and make growing demand direct USTR and USDA
to reallocate WTO minimum tariff rate shortfall earlier,
strengthen restrictions around the April 1st provision, and
direct RMA to develop a revenue insurance policy for sugarbeet
producers. These are common sense updates that will provide
stability and strengthen the U.S. Sugar Policy for sugarbeet
producers across the country.
In conclusion, on behalf of more than 11,000 sugarbeet and
sugarcane farmers, along with thousands of employees, and our
mills, processors and refineries, we urge this Committee to act
swiftly to pass a strong five-year farm bill that strengthens
U.S. Sugar Policy and supports all of U.S. agriculture.
We stand ready and eager to work with you to get this done.
I look forward to your questions.
[The prepared statement of Mr. Deal can be found on page
140 in the appendix.]
Chairman Boozman. Very good. Thank you. Jennifer.
STATEMENT OF JENNIFER JAMES, BOARD OF DIRECTORS, USA RICE,
NEWPORT, ARKANSAS
Mrs. James. Good afternoon, Chairman Boozman, Ranking
Member Klobuchar, and the Members of the Committee. Thank you
for the opportunity to testify.
I am Jennifer James, a fourth-generation rice farmer from
Newport, Arkansas, while I consider myself a rice farmer, first
our family farm is diversified. I farm with my father and
husband, and recently our son has returned. Words cannot
express the absolute joy of having your child share your desire
and passion for farming and his dream of continuing our family
legacy into the fifth generation. We primarily grow rice,
soybeans, and corn. I am proud to serve the agriculture
industry as a member of USA Rice and in other various roles.
Today's hearing on the farm economy is extremely important
for rice farmers. Rice farmers have been facing a prolonged and
perfect economic storm. We did not enjoy the run up in prices
experienced by many other crops in 2020 and 2021, but we shared
fully in the enormous increases in cost of production.
Unfortunately, the Price Loss Coverage Program, the chief
safety net for rice, is out of date for our producers.
According to the Agricultural and Food Policy Center, this
resulted in an $880,000 loss in net farm cash income per rice
farm from 2021 to 2022 alone, with two-thirds of rice farms
predicted to have negative margins for 2022. Thankfully,
Congress provided vital relief for rice farmers in 2022. These
conditions have persisted for rice farmers, and have spread to
producers of nearly all crops leading Congress to provide much
needed aid for 2024.
Thank you for delaying what would have otherwise been a
full-fledged farm financial crisis for many without your
action. I know this Committee appreciates that there are still
farmers out there who even with this relief, will no longer be
farming because the conditions are that bad. There are many
other operations that will simply be bridged into the next
crop.
Rice farmers must have an adequate PLC reference price, one
that reflects the realities of the financial pressures that we
face. I know you are working to pass a new farm bill, and I
would encourage you to ensure the improved Farm Safety Net is
effective for the 2025 crop year. Congress must act to
stabilize this fragile situation to protect our food supply,
shore up domestic production, and ultimately secure our
national security through food security.
As I worked on our budgets for this year, rice is projected
to lose $345 per acre in my area. Soybeans are projected to
lose over $250, and corn over $280. Nothing in my area pencils
out. This is not economically sustainable. Last year I
completed my 30th full-time crop, and it was the most difficult
year financially that I have endured so far.
This year, I am even more worried about what is to come.
Just last week, we had one of the hardest business decision
conversations my family's had. ``Is farming really worth it?''
What scares me is I know that we are only one farm family of
thousands who are having these same conversations. I pray this
situation turns around, and if it does not, then Congress has
the courage to step in. We need assurance for not only the
current generation of farmers, but for the next.
My son, he gave up baseball when he was in the ninth grade
because he did not want to miss spring planting season. Farming
is all he has ever wanted to do, and I want to see to it that
he is able to follow his dream. Unless things change
drastically without a relevant safety net, farm families will
have no choice but to ask for more ad hoc assistance. We cannot
continue to head to the field, and plant a crop, and know that
we will lose hundreds of dollars per acre. Frankly, it is scary
when all you see is red ink.
Farmers, local businesses, and our entire communities are
at risk. If rural towns see population decreasing, our schools
and hospitals may not have enough people to sustain them. We
have all heard the saying, ``Hope is not a strategy.'' Today, I
urge you to deliver a new farm bill so we no longer have to
hope, but rather we know that we can continue to farm and enjoy
what we do; provide food for our fellow man.
Thank you for your time.
[The prepared statement of Mrs. James can be found on page
149 in the appendix.]
Chairman Boozman. Thank you very much. Again, the
testimony's being so thoughtful, so compelling. I have had the
opportunity to sit through--I guess it is an opportunity, to
sit through many, many hours of testimony in the last several
years, you know, being on this Committee. It is really
interesting, I do not think I have ever heard a more uniform
testimony and across the board. You just demonstrate how
difficult it is in Rural America right now, doing what you do.
First of all, I want to thank you because a lot's been
mentioned about the aid that we were able to get at the end of
last Congress. That was this Committee working really hard in a
very bipartisan way to get that done. That is great, but we
could not have gotten it done without your organization
stepping in and really applying the pressure that we needed for
Congress to understand how difficult it was. Give yourselves a
pat on the back and I think it also really illustrates what
agriculture can do when it stands together.
Jennifer, you mentioned it being so tough and yet you had a
good yield, just so that complicates things even more. Tell us,
if we had in play as you make these tough decisions about
continue to farm, you know, what you are going to do, what you
are going to plant in the future, all of those kinds of things.
Tell us what impact it would have if you had in place a good
solid five-year farm bill that you could count on that actually
did provide risk management tools?
Mrs. James. Right. I think, Senator, with updated reference
prices, as have been mentioned by many of my peers here on this
panel, I think it would give farmers confidence. I think it
would give our lenders confidence that there was actually a
floor out there to plan for and to work toward.
It is definitely just a risk management tool, and for those
of us in rice, like you mentioned, we did have good yields and
even so that was not enough to help us bridge the financial
gap. That five-year contract as we think, you know, look to it,
is very important to us. As I stated, would hope that it could
be in effect for the 2025 crop year with those updated prices.
Chairman Boozman. Very good. Jennifer's mentioned the PLC.
Tell me, would any of you share your thoughts on the role that
crop insurance has played in these recent years of depressed
prices and extreme weather conditions? What should Congress be
considering when it comes to crop insurance as far as trying to
make improvement, Mr. Hartman?
Mr. Hartman. Well, definitely with these times, obviously
when you are putting out a corn crop, you have got a lot of
expenses when it comes to fertilizer. We definitely need to
support higher levels of crop insurance. You know, I myself
take it that 75-80 percent, but I think we need to get to
higher levels so we can support because there is a lot more
risk there right now when it comes to the costs of putting a
crop out.
Chairman Boozman. Anybody else?
Mr. Reed. I would add to that, that representing cotton,
even though it is a southern crop, it is a very diverse area.
You get on the coast and there is the big risk of hurricanes
and weather damage. You get West Texas, huge risk of drought.
Where we are in the Delta, we have irrigation. Our risk is a
shallow loss.
That is why it is so important in the farm bill, either in
updated SEO program or the ability for cotton to take out both
stacks and participate in the PLC program. Because we are
always going to make the yield, our biggest risk is the shallow
loss.
Chairman Boozman. Very good. Anybody else? Keeff?
Mr. Felty. Yes. You know, the crop insurance is the front
line of defense. It is the most reactive, it is the most
efficient, and we all have a stake in our product and we know
where we need to be for our region. Making that more affordable
would have a better adoption rate, and it would also help
support in the times of true need due to natural disasters. I
would like to mention that Senator Hoeven did put out the
FARMER Act and it really does address a lot of our concerns.
Chairman Boozman. Very good. Senator Klobuchar.
Senator Klobuchar. Very good. Thank you very much. Well, I
will lead off with our Minnesotans here, with you Mr.
Engelstad. Could you talk about--several members have mentioned
young farmers and ranchers, and all the challenges that they
have. Could you talk about how strengthening the Crop Insurance
Program could better serve farmers and ranchers, and especially
beginning and limited resource farmers and ranchers?
Mr. Engelstad. Absolutely. No, it is definitely a key
proponent as a younger farmer because if you do not have that,
a lot of lenders will not be able to get you operating loans
for the year. That is a big, big thing for all the guys. All my
guys that I know of my age, are farmers my age, it is
definitely a key component to have that, so.
Senator Klobuchar. Okay, very good. Thank you. Mr. Deal
when it comes to sugar, you highlighted that in some of the
drafts last year, how Senate--a lot of drafts circulating
around, but there were some proposals that would make updates
to the Sugar Program. Can you talk about how these proposals
will facilitate the long-term stability of domestic sugar
production and help to ensure sufficient supplies for your
customers?
Mr. Deal. Yes, I can do that. Within our sugar policy, our
loan rate is our safety net. That is all we have. We do not
have ARC, we do not have PLC, we also do not have a revenue
guarantee in our policy for Federal crop insurance. Those are
the main things. You know, we are an importer of sugar, and we
are importing 25 percent of the sugar that Americans use here.
We need to make sure that we are viable so that we do not get
behind and even have to import even more. We need to keep a
viable sugar industry here in the United States.
Senator Klobuchar. Very good. Agree. Mr. Gackle, it was
great meeting with you the other day. Could you talk about--and
I mentioned in my opening, the studies with soy and with corn,
when it comes to any potential retaliatory tariffs. Could you
talk about what the impacts could be, even with hanging out
there and so much uncertainty when it comes to soy?
Mr. Gackle. Sure. Thank you, Senator Klobuchar. You did
mention it in your opening remarks, a total cost to U.S.
Agriculture in general of $27 billion looking back on the 2018
trade war. We just use history as a guide and expect that
something similar could happen again. The biggest concern with
that this year, even with it hanging out there--I mean, you saw
Sunday night, if you were watching the markets when they opened
before President Trump had announced that a 30-day delay with
Mexico and Canada, but the markets were already reacting to a
potential trade war and how that might affect us.
For farmers, for me as a farmer in North Dakota, it is not
just what might be imposed by Canada or Mexico, but a 25
percent tariff on Canada includes--you know, 87 percent of the
potash that we use as farmers in the United States comes from
Canada. There is a cost right there.
Senator Klobuchar. That was actually--I used those numbers
on a national call the other day that was not about ag, but I
put that in there just because of the extraordinary numbers of
what it costs for an acre of corn and add for an acre of
soybeans.
Mr. Gackle. Correct. I mean, there is a real risk right
there directly. I think it is just important to remember as the
Committee considers a farm bill and other types of assistance
for farmers, that the margin for error this year in 2025 is
much different than 2018. There was in our pocketbooks and in
our cash-flow and our working capital on our farms, we probably
had a little more room there in 2018, coming out of some good
years. This year, things are even tighter. The margin's not
there. The risk is even greater. Caution is urged by all.
Senator Klobuchar. Very good. Mr. Hartman, just from the
corn perspective, you noted in your testimony that experience
shows the lost market share cannot be easily recaptured. Do you
want to expand on that a little bit?
Mr. Hartman. Well, obviously, the concern is when we look
at South America, they keep increasing their acreage on corn
production, on soybean production. Every year that increases.
If we do lose those, there is countries on tariffs, they are
going to just keep buying corn from Brazil or Argentina versus
from us is the problem once that starts.
You know, the other thing we have going for us right now in
the United States is we have got a good transportation system
that actually does need to be improved. They are improving
their transportation system every year, so that is going to
help them too, as far as economics. I mean, they are advancing
every year on us, so we got to stay ahead of that.
Senator Klobuchar. Good point. Mr. Felty, Ms. France, last
question here. The 90-day pause in new obligations and
disbursements of food aid funding has sown confusion, and is
threatening to disrupt the delivery and distribution of U.S.
commodities like wheat, rice, and sorghum for those in need.
In previous testimony provided to this Committee, your
organizations noted the importance of international food
assistance. It is obvious for starving people around the world,
but it also means something in the U.S. What will this
disruption in food mean for U.S. shippers, mills and processors
and farmers who participate in food aid programs, Mr. Felty?
Mr. Felty. Yes, ma'am. You know, we have always been very
focused on food aid reform, and programs that give out cash or
buy from our foreign competitors cause direct harm to American
farmers. However, the food aid programs that do buy American
commodities are critically important, and we want to make sure
those continue to function.
Unfortunately, we have seen a temporary pause on programs
like Food for Progress that is stopping more than 200,000
metric tons of wheat valued at over $65 million to our
producers from being purchased from this country. You know, we
look forward to working with the Committee and President
Trump's Administration to keep these purchases from American
farmers moving and supporting the rural economy.
Senator Klobuchar. Thank you. Mrs. France.
Mrs. France. Thank you for the question, Senator. As a
Kansan, I am very proud of what we believe the late Senator
Dole thought of when he started his work on this and to help
the less fortunate. I would just echo, sorghum, certainly for
the crops, the U.S. grown crops to be shared. A lot of our
sorghum for that goes to Africa, and so we certainly look
forward to being able to continue that conversation, but stress
that we encourage U.S. crops, commodities, sorghum to be
delivered to these countries, not the cash.
Senator Klobuchar. Thank you.
Mrs. France. Thank you.
Chairman Boozman. Senator Moran, who we are very pleased to
have on our Committee.
Senator Klobuchar. I think I see him down there. He is so
far away.
[Laughter.]
Senator Moran. Amy, that is so cruel. Thank you for that
entree, because I was thinking that I spent 14 years on the
House Agriculture Committee, and I was on three farm-built
conferences, and it has now been 15 years since I was on an
Agriculture Committee. With your approval, I have 14-15 years
of questions this morning for our panelists.
[Laughter.]
Chairman Boozman. The most active Aggie in the Senate not
being on the Committee. We are glad that you finally joined us.
Senator Moran. Thank you. I should make it clear that the
Senate rules prohibit me from serving on this Committee because
other Kansans, when I came from the House, Senator Roberts was
here, and Senator Marshall then after that, and so it took a
waiver to get here. I just happened to be in a position this
year to get the waiver, and I am really excited and I am
pleased to see all of you.
Amy, you were testifying as I walked in the door from
voting. Remind me the policy differences between sorghum and
other crops that negatively affect planting decisions when it
comes time to plant.
Mrs. France. Well, I do want to say we are happy to have
you here, Senator Moran. Because sorghum is so resilient, we
are the resource conserving crop. Oftentimes, when it looks as
though nothing else can be grown, sorghum gets thrown in the
mix because sorghum can produce--as I said, it is resilient. It
is not weather immune, but oftentimes we get punished for that
because we can tolerate such harsh climate.
I would say that would be the number one concern. It is
hard to balance that because we are very proud of the
resilience and what sorghum does for a rotation. Yet
oftentimes, we are punished for the great things that we can do
and can produce a crop regardless.
Senator Moran. Thank you. Mr. Reed, I was always proud that
Kansas, for a long time, was the fastest growing cotton State
in the country. Acres. It shares the drought resistance that
has been desperately needed in our State. What unique factors
to other commodities do you face to make sure that Kansas and
other places can continue to be cotton producing?
Mr. Reed. Well, cotton is a very resilient crop, similar to
sorghum. You can put high inputs into it and yield, or even in
certain parts of droughty areas, low inputs, it will still
produce a crop. You all have done very well in Kansas and out
producing our high input areas in droughty areas. They are very
proud of the Kansas cotton farmers.
Cotton is a little unique versus corn and soybeans in that
we do not have the underlying domestic consumption of biofuels.
Cotton is exported, a large portion of it. I guess right now,
we feel like as cotton producers, we are kind of playing
against a stacked deck. A lot of times America consumes 25
million bales of cotton. We produce 12 to 14. We feel like we
are getting thrown to the world market where our competition
does not--and this is true across all commodities, but a lot of
times our competition pays less per day than we pay per hour to
employees.
We are shipping the same equipment that we are using at a--
they are able to use it as substantial reduction in cost with
no emissions equipment. We are being asked to compete on this
world market, but being held to standards. We are proud of
that. I say that we can produce the highest quality,
environmentally friendly crop with worker protection safety
standards in the world. It has been difficult for us to compete
against the world on price.
Senator Moran. Thank you. It suggests to me one of the
things that I am hopeful to be an active participant in the
drafting of the farm bill and its discussion, and one of the
things that I think that as a Kansan I would bring to the table
is the importance of dealing with drought. By that, I mean crop
insurance factors features multiple year disasters or something
that crop insurance has never been able to provide adequate
indemnity. It also means, in my view, conservation practices
that can assist in regard to the consequences of drought and
research that helps us get the crops that are most capable of
resisting and producing during a drought season. Anybody on the
panel have any thoughts about drought and the farm bill? Just
tell me I have said it correctly and I am happy to move on. No,
you do not need to. Amy?
Mrs. France. I would say everything you said just a moment
ago says sorghum. We are very proud of. Again, we are the
resource conserving crop, and we are thrilled that that has
been recognized. You know, it just gives us the opportunity to
speak to what farmers have done for years, continue to be. We
are conservationists and the proof is the fact that we have
many generation farmers here. If we did not do the job we did,
well, we would not have many generation farmers here today.
Everything you said I am proud to say sorghum fits that
resource conserving drought tolerant. As you know, Senator
living on top of the Ogallala Aquifer that is quickly
declining, water is top priority for us, and we continue to
grow a good crop, weather permitting, even in those tough
conditions.
Senator Moran. Mr. Felty, it would be a terrible mistake if
I did not talk about wheat and come from Kansas. The Senator
earlier indicated we compete with other States to produce the
most wheat. Senator Hoeven and I seem to have competition on a
number of things, and I wanted to talk about acres planted to
wheat.
First of all, to highlight drought. Our Kansas wheat
production this year was the lowest production of wheat in
Kansas since 1961. That has a significant consequence to our
economy. I wanted to hear from you, what policies specific to
wheat return, the number of acres, increase the number of acres
that would be planted. Price, I assume is the significant
component of planting decisions, but how can the farm bill help
wheat, in particular, have a rebound in Kansas and elsewhere?
Mr. Felty. Well, as you mentioned, price is definitely the
main driver. In areas where there are other alternative crops
in good conditions, wheat unfortunately does oftentimes get
replaced in the cropping system. I do know that there is a lot
of rotation that wheat is very beneficial especially up in
northwest Kansas. Looking toward that to enhance the overall
operation and profitability of the farm is definitely something
that we are working on.
Senator Moran. We were on a mission with RMA to get the
information necessary to reach the conclusion that wheat can be
a cropping rotation plant. My time, my 14 years, 15 years went
fast. Sorry I asked Ken McCauley for what question I should ask
for corn, and he has given me a question, so I at least want to
let you know that I am thinking of corn, but ran out of time to
ask Ken McCauley's question.
[Laughter.]
Chairman Boozman. Very good.
Mr. Hartman. Well, tell Ken--tell him I said hi.
Senator Moran. I will do it.
Chairman Boozman. Senator Warnock.
Senator Warnock. Thank you, Mr. Chairman. President Trump
has proposed tariffs on our three largest trading partners,
China, Mexico, and Canada, which have all promised to enact
retaliatory measures. We know from recent history that our
farmers will be on the front lines of any economic consequences
from these retaliatory measures from a trade war. We know this
because it is not the first time President Trump has started a
trade war that harmed Georgia farmers. We have all seen this
movie before.
In 2018, Trump imposed tariffs on China and they
retaliated. Mr. Reed, you are on the Board of Directors of the
National Cotton Council. Georgia's a big cotton State, and
cotton has always been one of our most important exports. What
effect did these retaliatory actions have on the American
cotton industry?
Mr. Reed. Well, I would say yes, they did affect.
Senator Warnock. Positively, negatively?
Mr. Reed. Well, they affected the cotton industry
negatively. We were thankful that his administration did work
to provide the MFP payments that kind of offset some of that
pain. I guess some positives were, it kind of rearranged the
way that cotton is consumed across the world. We did open up
new markets was a positive of that.
Senator Warnock. Did you gain market share or lose market
share?
Mr. Reed. We lost market share in China. We gained in other
parts of the world.
Senator Warnock. What was the net result?
Mr. Reed. Well, the net result was we did come up with a
phase one trade agreement that hopefully that maybe we can get
back. If China was continuing to purchase, that really has not
been stuck to.
Senator Warnock. A USDA study estimates that American
cotton farmers lost 37 percent of their exports to China.
Mr. Reed. It fell from 41 percent to 17 percent of the
numbers, yes.
Senator Warnock. You rightly point out that this was
answered by subsidies.
Mr. Reed. Yes.
Senator Warnock. I think I am right in suggesting that
farmers would rather have trade than aid.
Mr. Reed. Absolutely.
Senator Warnock. Yet we are seeing this movie played out
again as President Trump proposes the same failed policies at a
time when American farmers are already contending with slim
margins. I am glad that Canada and Mexico tariffs have been
delayed, and I hope they never go into effect because the
farmers I am talking to in Georgia are worried about this kind
of uncertainty there.
There is a lot of Republicans and Democrats who disagree on
a whole range of things, but I think everyone here would agree
that Congress is overdue on delivering a new farm bill. The
Chair, and I, and other Members of this Committee have talked
about the need to get a farm bill. Many farm bill programs need
to be updated, including programs that support Georgia's peanut
and cotton farmers.
Mr. Reed and Mr. Moore, you are here on behalf of the
Nation's cotton and peanut producers, respectively. Why don't I
begin with Mr. Moore? Can you talk about updates the peanut
farmers are looking for in the next farm bill? Same thing with
cotton.
Mr. Moore. One of the things we are looking for is updating
reference price, and we need a better and a more efficient
safety net for us to be more profitable and have more of a
safety net to secure us some bad years. Also, the chance to
build base acres. I was not around or was not farming in the
time when they had the chance to build base acres. You know, I
am a young farmer and new into the industry, and I would like
to have the chance to build the base acres, acres which would
also help us tremendously.
Senator Warnock. Base acreage increase and reference
prices. Would you like to see it increase in reference prices?
Mr. Reed. The most important thing short-term. Obviously,
long-term, we would like to open up markets and not have to
depend on the farm bill to stay in business. In the short-term,
yes, updated PLC reference price would be the most important.
Senator Warnock. I agree with that. With input cost
remaining high and now the threat of potential tariffs and
retaliatory trade war, we need to ensure that the next farm
bill adequately increases reference prices and allows more
farmers to participate in these commodity support programs. I
will continue to fight for that. I will continue to fight for
southern commodities like peanuts and cotton in farm bill
negotiations.
If we are serious about getting a bipartisan farm bill
done, we need to remember that it takes a broad bipartisan
coalition to get that done. One that both supports the farmer
and the family safety net. I resist this false dichotomy that
we have got to either be present for farmers or show up for
folks who need security who need basic food security.
I am hopeful that we will move forward in getting a farm
bill done and that we would recognize that unserious proposals
to cut critical nutrition programs to pay for tax cuts for the
super wealthy will not make passing a farm bill easier, it will
make it more difficult right at a time that our farmers are
going into yet another planting season with so much
uncertainty.
I look forward to working with Members of this Committee.
The Chairman and I have had many conversations with how we can
push forward a bipartisan farm bill. Thank you.
Chairman Boozman. Senator Klobuchar, do you have any other
questions or comments?
Senator Klobuchar. No. If you do, go ahead. I am looking
forward to talking to you afterward, and I want to thank all of
you for being here. This could not be a more critical time, and
I am very positive about the working relationship that Senator
Boozman and I have. I hope you notice we have a lot of activity
on our side, interest in the Committee, and especially with
some of our new Members. We are ready to work with all of you.
I thank you for appearing before us today.
Chairman Boozman. Yes. Thank you a bunch. It has been a
long day. You all have been here for a while. It is really an
interesting time to be here, but we do appreciate you so much
for your participation and really outstanding testimony. I want
to thank my staff and Senator Klobuchar's staff, as always, for
their hard work in making these things happen. It is not easy.
With that, today's hearing is adjourned.
[Whereupon, at 1:48 p.m., the hearing was adjourned.]
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QUESTIONS AND ANSWERS
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