By Illinois Radio Network
BLOOMINGTON – Farmers across the United States, including those in Illinois, are having to face the reality of higher crop yields but lower prices on those crops.
Mike Doherty, senior economist at the Illinois Farm Bureau, said the financial setbacks could force farmers to make tough decisions, including seed choice.
“They may not choose the optimal seed,” Doherty said. “They may choose a cheaper seed, hoping that the benefits of the more expensive seed will not have been necessary after all.”
Doherty said 85 percent of farmers surveyed told the Farm Bureau they were planning to delay equipment purchases, opting instead to try making the equipment last longer. Additionally, Doherty said farmers were planning on reducing interest payment and reducing farm debt, along with reductions in fertilizer and hired help.
Doherty also said there was a potential farmers could make the harder decision to reduce acreage, such as a field but not the whole farm.
“That is a more drastic maneuver or strategy or reaction to the financial stress, and I think we will see some farmers having to do that as well,” Doherty said.
Doherty said the price has dropped on crops because of competition overseas, especially in countries such as Brazil and Argentina.
“So, increased competition because of increased investment overseas is part of it,” Doherty said. “They are also increasing their acreage and their yields.”
There is some concern among farmers that the U.S. might leave some of its trade agreements. Doherty said the stability those agreements bring is important for farmers.
“That is front and center almost every day in a farmer’s mind, is the need for U.S. agriculture to stay in the trade agreements we are currently in,” Doherty said.
Doherty said one of the biggest things the state can do to help farmers is to keep the transportation system up and in good condition.