Ag secretary at Big Iron: happy farm prices are up, but concerned about rising costs

WEST FARGO, N.D. — U.S. Agriculture Secretary Ed Schafer came home Tuesday to bask in the glow of farmers and implement dealers celebrating big crops and high crop prices, but he said he shares their concern about steeply rising costs for seed, fuel, fertilizer and other agriculture inputs.

The former two-term North Dakota governor, who was appointed to the Cabinet last year by his friend President Bush and confirmed in January, sat for a two-hour question-and-answer session with farmers and others attending the 28th annual Big Iron Farm Show and Exposition, which bills itself as the largest farm expo in the Upper Midwest.

Schafer remains popular here despite recommending that Bush veto the new farm bill as too expensive and lacking in reform measures, and the first questions he faced were the sort that neighbors might ask of a good friend who’s been away: What’s it like to sit in the Cabinet? What’s Camp David like?

The secretary responded by telling how he had to borrow a tie from a desk clerk at his Washington, D.C., hotel when he arrived late, without luggage, for his first Cabinet meeting, and how a Navy officer gave him a tour of the presidential retreat and all its amenities. “What surprises you most about Camp David?” the officer asked him. “That I’m here,” Schafer said.

Export sales important to N.D., Minn. economies
Big Iron expects 800 exhibitors and 70,000 visitors this year, a good share of them from neighboring Minnesota, and the flags of Germany, South Africa, China and other nations fly on the Red River Valley Fairgrounds to reflect its international reach. Expo managers say that export sales of farm machinery are increasingly important parts of the North Dakota and Minnesota economies.

When Schafer first attended Big Iron in 1992, when he was running for governor, wheat was bringing $3.20 a bushel. On Tuesday, it was above $7. Prices for corn and soybeans also were more than double what they were in 1992, he said.

Those price levels and good yields have farmers walking tall and implement dealers smiling. But Schafer acknowledged that input costs and land prices are up sharply, too, and those expenses show little inclination to stabilize.

“That’s something we pay a lot of attention to because we want to keep producers profitable,” he said. “We want to keep them on the land.”

Seeks comprehensive energy policy
He said a strong national energy policy is essential for that, and such a policy must cover old energy as well as new.  “The problem today is we’re pitting oil people against wind people,” Schafer said. “We need a comprehensive energy policy, and we need legislators committed to making it happen.”

Mike Hergert, a broadcaster with the Red River Farm Network, said the rising costs of farming have tempered farmers’ glee over historically high commodity prices and good yields.

“Anybody who grew wheat this year, it’s hard to get information out of them — it was that good,” Hergert said. “Whenever farmers are quiet, you know they’re doing well. But the cost of fertilizer is going crazy, and there’s concern about fuel, seed and other costs.

“Also, it was chilly this morning, and that scares people who still have crop out there. We’re going to lose a lot of corn if we have an early frost.”

Tom Voller, who has a diversified grain farm near Hazelton, N.D., said that he’s “cautiously optimistic” after a good year, and with his son and partner, Eric, he spent part of his time at the expo admiring some monster combines. But he, too, expects the rise in commodity prices to slow while inputs continue to catch up. “It could get ugly if that continues,” he said.

Added Terry Goerger, Big Iron’s chairman, “It still comes back to penciling out that bottom line.”

Returning after inauguration
Schafer said that he does not expect to stay on as agriculture secretary no matter who wins the presidential election. “We expect to be out on Jan. 20 and back to North Dakota,” he said.

“I love the job,” he said, but public service “should be short-term commitments” — and he surprised longtime supporters by saying he has “reluctantly” changed his mind about term limits for elected officials.

Voters should retain the power to impose term limits “at the ballot box,” he said, but the influence of money and bitter partisanship has changed the nature of government service. For too many who reach Washington, “the fight is to stay there” rather than work to develop good policy.

Reminded by a questioner that Rep. Collin Peterson, D-Minn., chairman of the House Agriculture Committee, has proposed greater congressional oversight of the Department of Agriculture, Schafer said that “it’s something I would look forward to working with him on” if he were to continue leading the department. The Minnesota Democrat “is a big champion of reform” in farm legislation, he said.

The secretary also urged farmers and agricultural researchers to continue working toward greater crop yields to meet the rising global demand for food. Recent shortages led to food riots in countries around the world, he said, and he cited the example of Zimbabwe. The African country should be a net food exporter but has become totally dependent on imports, he said, including U.S. aid that is feeding a million people a day.

“It’s a tragic situation,” Schafer said, noting that the average lifespan there has fallen by 20 years, to just 37, in the past seven years.

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