Farmers say they are struggling with inflation, volatile prices
Wisconsin dairy farmers have been struggling for years. Lately many family-owned farms have been hit especially hard by inflation and volatile prices.
Rachel Schroeder says the past five years have been especially nerve-wracking for their small-scale dairy farm that she co-owns with her father in Jefferson County.
"Our margins have always been really tight," she explained during an online press conference hosted by the Republican National Committee on National Ag Day. "Every year we have the conversation on whether we're going to close our dairy operation or not."
Oddly enough, she says their farm was profitable in 2021 despite the pandemic.
"But that was because of all the government subsidies. That bothers my dad and I because we want to be independent of the government," she said. "We're happy to keep farming, but we want to do it independently with good ag policy in Washington, and not with money being thrown at us which is the cause of the inflation we're seeing now."
Congressman Tom Tiffany, who grew up on a dairy farm in western Wisconsin says record inflation is the wrecking ball that's hitting the economy and dairy farmers with a devastating blow.
"A big part of this is the rising energy prices that affects farmers in every way possible. From diesel fuel to fertilizer - all those inputs that go into producing a crop," Tiffany said. "These record high energy prices may eventually impact the ability of America to feed the world."
Wisconsin Rep. Tony Kurtz knows firsthand how rising costs are squeezing the financial viability of small farming operations. Kurtz says he began farming in 2007, and over time began converting his cropland into an organic grain farm.
"In 2020, off-road diesel cost me $1.68 a gallon. In 2021, that price rose to $2.49 a gallon," he said. "When I called the coop to fill up my 550 gallon fuel barrel, it was $4.05 a gallon. Agriculture is Wisconsin's second largest industry, and I can tell you those prices are going to affect every farmer."
Farmers all around the country are gearing up for the 2022 planting season. Wary of impending fertilizer shortages, Schroeder says they made the decision to apply fertilizer last fall.
"We did that just to ensure that we were going to have some in the soil for this coming spring because we were not guaranteed that our coop was going to have it," Schroeder said.
Last year, Kurtz says he bought potash for $773 a ton.
"When I called today I was shocked to learn it was selling for $1,425 a ton!" he said. "Many farmers are cutting back especially in light of the situation in Ukraine. We in the U.S. should be producing as much grain and agriculture products as possible. But unfortunately, with the high inflation from the Biden Administration, that's going to be curtailed."
Many farmers like Joe Ebert, a third generation farmer, who runs an organic dairy farm in Wisconsin, are becoming increasingly frustrated over the growing challenge in finding used parts for their equipment line.
"I ordered a part for my hay cutter last June and received it in February," Ebert said.
While seeking materials to fix his old five-bottom plow, Ebert asked to purchase five 6-by-four pieces of iron. He was quoted $300.
"I told him that was a lot for five pieces. When he rechecked the price, he told me it was $300 a piece! Something that would have normally cost me $250 was $1,500," Ebert said. "I spent $10,000 on fuel last year on my small farm and that's easily going up to $15,000. And that's just one thing. I don't know how we will be able to withstand this."
Not sound policy
Larger operations are also sharing in the pain. Joe Bragger, a dairy and row crop producer from Buffalo County, says that despite higher commodity and milk prices, he believes high prices can lead to low prices very quickly.
"It's been five to six years since many farms have really done well. Instead of being in a period of a long overdue recovery, we're getting hit," Bragger said. "Yes, the milk price is up, but my trucking used to cost $4,500 to haul my milk to town for the entire year. Now we're approaching $60,000."
Bragger says farmers shouldn't have to count on a pandemic or the threat of global war to bring up the prices of commodities.
"That's not sound policy. This is not going to be a recovery because we cannot keep up. If our costs are doubling, I can promise you our commodity prices haven't doubled yet. And ultimately the farmer will be left with the blame for the high food prices," Bragger said. "We're struggling to make ends meet every day like the rest. I'd sooner have sound policy created by good people to guide us rather than by reactions."
Tiffany noted that farm income is projected to be down by 8 percent this year.
"So, those increases (in milk and commodity prices) do not translate into increased farm income going into farmers' pockets so they can make improvements on their operation," Tiffany said. "They're actually going to see a decrease.
"And that is what's happening across America. Americans are seeing that the buying power of their paycheck is going down as a result of inflation. Inflation is a harsh tax on all Americans," Tiffany added.