Imagine working hard all year, long hours out in all kinds of weather, dangerous work, just to find yourself tens of thousands of dollars poorer at the end of it all. And then, next year, do it all again, and dig even deeper into debt.
That’s the situation many Midwestern farmers are in, because it costs more to grow corn and soybeans, and wheat than farmers can make selling them.
But through most of the last two years, farmers have all had a reliable partner, the U.S. Department of Agriculture.
“We always look at everything as tools in the toolbox, you know, and the USDA is obviously a valuable tool,” said Stephen Kalb, taking a short break from harvesting soybeans on his farm near Baldwin City, Kansas. “They're our friend, you know. They help us in so many ways.”
Good farmers maintain close working relationships with the USDA. The agency is the gateway through which all federal farm assistance flows. It helps to keep farmers in business and the food supply strong when natural disasters strike or markets plunge. It disburses emergency payments from Congress. It helps fund conservation projects and shores up rural towns.
But with the shutdown, all that has come to a stop.
“The Agricultural Risk Coverage Program and the Price Loss Coverage Program, those payments typically go out in early October. That hasn't happened, that's my understanding, and I assume it will not happen until the shutdown ends,” said Pat Westhoff, director of the Food and Agricultural Policy Research Institute at the University of Missouri.
For Kalb, the shutdown means a stalled conservation project on his land.
“This would be a great time of year to be working on it,” he said. “We're just waiting on paperwork, but I physically can't start that project.”
After the fall harvest, lots of farmers take out short-term USDA loans, using their stored grain as collateral. Those loans are crucial in years like this one, when prices are too low to make money. The loans provide operating funds that let farmers hang onto their crops in hopes of selling at better prices later.
“I've literally done this for 55 years,” said Richard Oswald, who farms on the Missouri River in northwestern Missouri. “It's been something that has always been there.”
But this year it’s not there, because the USDA isn’t open to administer the program.
It’s not his only problem with the shutdown.
“It affects a lot of things,” said Oswald. “One thing we’re not getting – USDA reports on the crop yields or the crop progress.”
USDA’s last report in September predicted a record-breaking corn harvest. That kind of abundance drives down prices. Crop conditions have changed since that September report, but the market is still influenced by the last one, possibly depressing prices.
“This is one of the worst times within the year to shut down USDA,” said Iowa State University economist Chad Hart. “You combine that with you’re shutting it down at a time when the ag economy is in a recession, so it’s sort of a double-barrel hit.”
Farmers are vulnerable because inflation and tariffs are driving up the prices of the fertilizer and farm machinery they have to buy, and the trade war is depressing prices of the commodities they have to sell.
China once bought one-third of the total U.S. soybean harvest; it was by far the biggest export customer. Today, China isn’t buying any soybeans from the U.S., getting them instead from rival producers in Brazil and Argentina. The resulting soybean glut here is driving down prices.
President Donald Trump has promised to use tax dollars to help compensate farmers for their trade war losses. Trump set a date to announce the bailout, but it came and went with no mention of assistance.
“Things aren't going to go forward until the government’s open again,” said Westhoff. “While if there's a chance they can make an announcement before a shutdown would end, they wouldn't be able to implement things till after.”
Westhoff figures it will take weeks after the shutdown ends for the USDA to ramp up, figure out how to allocate the bailout money and help farmers apply for it.
Meanwhile, with money and information in short supply, many farmers will struggle to pay their bills and struggle to plan for next year.
Some won’t make it that long. Farm foreclosures are rising, and most economists expect that trend to worsen this winter.
This story was produced in partnership with Harvest Public Media, a collaboration of public media newsrooms in the Midwest and Great Plains. It reports on food systems, agriculture and rural issues.
