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Upmeyer: Iowa’s farm economy in decline

From Rep. Linda Upmeyer –

Rep. Linda Upmeyer
Rep. Linda Upmeyer
Autumn is finally upon us which brings one of my favorite times of the year in Iowa. Pumpkin patches, football, and harvest season fill our weekends, and we’re treated to absolutely gorgeous weather while we watch the leaves change colors. It’s truly hard to think of a better time of year.

In talking over the last few months with farmers across Iowa, I’m hearing more and more about the sluggish farm economy. Agriculture and rural communities are the backbone of Iowa and our economy so it’s important to keep an eye on what is going on with our farmers. This year has been especially tough for our livestock and crop farmers in dealing with both the avian flu and the decline in commodity prices.

We saw a high in corn and soybean prices in 2012 and 2013, and while production has remained steady, demand has decreased internationally, lowering prices to levels that haven’t been seen since 2010. Forecasters have estimated that this year, farm incomes will be down about 36% compared to last year. Even with the expected bumper crop harvest, it is still going to be tough for crop farmers to pull in a profit as the high supply of grain continues to bring down prices. This means that farmers are trying to find ways to cut costs so that they can run their businesses, put food on the table for their families, and feed America.

The Avian Flu has also had a major impact on agriculture in Iowa as it has devastated poultry production. Bird flu, as it’s commonly referred to, wiped out over 34 million birds in the state, ranging from egg-laying hens to turkeys being raised for meat. I’m relatively confident that after this bird flu outbreak, the state is ready to respond to such a crisis if it were to happen again.

Finally, farmland values are also declining from what we are used to seeing over the past several years. A recent survey showed that cropland values fell 3.7% across the state over the last six months and 11.7% compared to a year prior. According to the September 2015 Iowa Chapter of Realtors Land Institute’s Land Trends and Values Survey, land value decreases ranged from as low as 1.9% in west-central Iowa to a high of 15.1% in northeast Iowa.

These things affect all of our communities because so many of our main street businesses provide some form of input to those farm operations…from start to finish, farmers rely on those products and services in order to do their work.

With the instability in the farm economy, it’s a good time to remember why I am so committed to managing the state’s budget like a family budget. Iowa families don’t spend more than they bring in, and we believe the state should do the same. When the Legislature makes unsustainable commitments and revenue doesn’t grow at the pace we’d like, or decreases (like in 2009), it leads to a bad fiscal situation. The Legislature must be judicious with Iowan’s tax dollars and not overspend to score political points.

While this is a difficult time for the state’s primary industry, I’m confident we will be able to overcome this situation and develop a sustainable budget next session. We have to play with the hand we’re dealt, and while it may be tough, I believe the Legislature will be able to come back in January and persevere through it.

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