STUDY SHOWS THAT FARMERS LESS CONFIDENT IN ECONOMY

(Agriculture Online) -- Agriculture Online reports that "a growing number of farmers ... are expressing concerns in the financial bedrock of the country." According to Rabobank's "Farm and Ranch Survey" for Spring '09, "twice as many farms than last year join those impacted by worsened year-over-year income levels." However, farmers in the North Central region are more optimistic than farmers in the South or West. "Input costs were one bright spot in the survey, as some farmers found some financial relief in lower production costs. But, a high percentage also said they don't expect that price relief to last very long."

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FARM SUBSIDIES MAY BE IN FOR A CHANGE

(Omaha World-Herald) -- Little is being said about farm policy during this year's presidential race, with bad economic news from Wall Street overshadowing most other issues. But Midlands farmers and ranchers are nervously looking for clues about their economic futures. Billions of dollars could be at stake. John McCain says he would eliminate subsidies if he could -- including the ethanol subsidies and mandates that created new markets for corn and raised prices for the grain. Barack Obama supports ag subsidies but says he would shift some dollars from the biggest and richest farms to do more for small family farms, organic farms and young farmers starting out. Farmers said they are craving more details. "We haven't heard enough about agriculture in this country, from either candidate," said Jeff Metz, a wheat farmer from Angora, Neb. who is a Republican supporting McCain because he fears that Obama will raise taxes. Joy Philippi, a 51-year-old Obama supporter who raises hogs and grain on 400 acres near Bruning, Neb., also has questions about inevitable budget cuts. But with a farm bill that will remain in place until 2012, the next president may have little opportunity to significantly change U.S. farm policy, according to Brad Lubben, a policy specialist at the University of Nebraska-Lincoln. Still, Nebraska, Iowa and Illinois each collected more than $1 billion in crop subsidy payments in 2005, a recent peak year for subsidy payments, according to an analysis by the Environmental Working Group, a nonprofit research organization that maintains a Internet database tracking farm subsidies. Metz said farmers' willingness to spend their payments on anything from a new combine to home repairs means that farm payments benefit Main Street as well as the countryside. Meanwhile, the Environmental Working Group contends that subsidies should be directed toward the farms "that are really struggling and really need help." During Senate debate on the 2008 farm bill, both Obama and McCain supported provisions that would have more strictly limited benefits paid to wealthy farmers and landowners. The final version of the 2008 farm bill included a $2.5 million total cap on the income a farming couple can earn and still receive subsidy payments; and a $340,000 total limit on most crop subsidies.

WASHINGTON POST ARTICLE ON THE FARM COUNTRY BOOM

(Washington Post) -- The farm economy in the Great Plains states are a bright spot in the otherwise gloomy national economic picture. In states like Nebraska, the housing market is holding up just fine, the banks are making plenty of loans, and employers keep adding jobs. Retail spending in the middle of the country was strong even before the $600 tax rebates this spring, and low interest rates and a tax provision in the economic stimulus bill are helping to goose already booming sales of farm equipment and pickup trucks. The price of farmland in Nebraska has doubled in the past three years, primarily reflecting the boom in commodity prices. The increase also reflects the impact of rate cuts by the Federal Reserve that enabled buyers to bid up land with borrowed money. But if crop prices drop toward historical norms, it could mean sharp decreases in land prices that would devastate some farmers. The availability of loans to farmers is the strongest it has been in five years, according to a survey by the Federal Reserve Bank of Kansas City, even as banks nationwide are becoming reluctant to lend money. The reason: There wasn't much overbuilding of housing here, so most regional banks are not saddled with the same bad mortgage and construction loans as their counterparts on the coasts. The good times are not uniform across the region; livestock producers have been pummeled by high prices for feed and fuel. In Blair, Neb., however, long-vacant storefronts have been turned into furniture shops and restaurants in the past couple of years, and Wal-Mart is looking to open a store just down the way. The billion-dollar Cargill plant that turns grains of corn into high-fructose corn syrup and ethanol just announced another $100 million expansion, adding a Danish company that makes enzymes out of corn -- a reflection of booming global demand for all types of commodities. That prosperity also shows itself on Lyle Schjodt's farm a few miles outside Blair, where he farms 1,000 acres of corn and soybeans, 150 head of cattle, and 1,200 hogs. He still has the first tractor he ever bought, back in 1968, in a shed. "I've been farming for 39 years, and I haven't seen a better year than this one," he said. Schjodt is upgrading his equipment; he just ordered a $120,000 Case IH planter, a massive red device that deposits seed corn every seven inches in 30-inch-wide rows. He bought a new $50,000 Ford F-350 back in the spring, too. Nationally, truck sales are battered by skyrocketing fuel costs. But auto sales are up 8% in the Omaha area so far this year, according to sales tax receipts.

RISKY TIME FOR FARM ECONOMY

I received this MSNBC article via email from a client. It is depressing but I thought you might be interested. Click on this link to check it out: Amid Strong Farm Economy, Some Dire Signs.