Iowa Agriculture, Sustainability and the Commodities Boom
by Paul Deaton
If the 84th Iowa General Assembly is anything, it has been a battleground for competing ideologies. To call it Armageddon, the scene of a final battle between good and evil before the end of the world, would be hyperbole. However, considering the deteriorating air and water quality in the state, disruption of crop growing cycles around the world, along with incidents of extreme weather, global food shortages, food riots and rising food prices, an argument could be made that we are living in the end times. But let's be optimistic and say that we are not currently heading towards the biblical apocalypse. What then?
Perhaps the most sobering recent account of the impact of these things was Friday on the Iowa Public Television program Market to Market. Host Mark Pearson interviewed analyst Sue Martin about the commodities markets for cotton, wheat, corn, soybeans, cattle and hogs. The good news about higher commodity prices was tempered with concern for what is going on in the world and whether these prices could be sustained. In a brief segment, Martin pointed to problems around the world, specifically naming China, Argentina, Brazil, Mexico, Australia, France and the former Soviet Union countries as all having food production and supply problems to some degree caused by weather. What does this mean? Pearson summed it up, “Ten, eleven dollars, pretty fancy prices for wheat, Sue.” It is the same across the board for commodity prices and Martin's firm recommended farmers make sales last week with high market prices. Record high commodity prices point to concerning problems with our food supply.
Martin said, “it appears like France is pretty much almost out of wheat. In fact, they dropped their import tariffs on feed grains until, I think, like, the end of June, basically because they need feed grains…” While Iowa farmers can profit from this environment, history tempers enthusiasm.
Martin: “No, we haven't and I think that part of it is going to be tied to the world buyer. These countries that are very concerned. You know this is the first time Mark that the Chinese have had to worry about competing against everybody else. Before they kind of had their way with the rest of the world because it was plentiful supplies, but this is the first time now that they've had to think about competing against the other countries that are very worried about their governments being overthrown because of high food costs and also the fear of not having enough.“
Governments being overthrow by higher food prices and food shortages? Mark Pearson and Sue Martin are not tree hugging liberals by any means. If they are concerned about climate change, food shortages, over production of corn based ethanol and “where's the rationing going to start?” then perhaps we should be too. Perhaps we should take another look at Iowa's approach to agricultural commodities.
Senator Grassley and President Obama both look to trade agreements with South Korea, Columbia and Panama as being a way to expand commodity sales and foster jobs in Iowa and elsewhere in the US. Last week, Governor Branstad promoted the Korea-United States free trade agreement, saying he would open an office in South Korea should the treaty be ratified by the U.S. Senate. At some point, we need to take a deep breath midst the current commodity prosperity and listen to the dialogue of people like Pearson and Martin.
We may not be living in the end times, but the good times can't last, as many farmers will tell you. Martin's firm recommended making some sales of old crop and new crop at last week's prices. There will only be so much crop to sell and then it will be gone or committed once harvested. With ethanol production taking 40% of last year's corn crop, growing populations in developing nations seeking cotton clothes, and American families increasing hamburger demand because of the financial pressure they feel, something has to give. A place to start is to develop an agricultural policy that supports more sustainable agricultural practices. That is hard to do when row crop agriculture and the commodities it produces are experiencing the current boom.
The alternative to more sustainable agriculture is to engage in the ideological debates going on in Des Moines and in the corporate media, stick our heads in the sand and wait for the apocalypse, saying “God grant me one more commodities boom and I promise not to piss it away.”
~Paul Deaton is a native Iowan living in rural Johnson County and weekend editor of Blog for Iowa. E-mail Paul Deaton
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