Farmers don't want government aid. They want a level playing field | Opinion - USA Today

This is the third column in USA TODAY Opinion columnist Rex Huppke’s ongoing series, America’s Looming Farm Crisis. It looks at the reasons farmers are struggling to stay afloat and details flaws in the U.S. agricultural system.

MAZEPPA, Minnesota — Rod Sommerfield is a third-generation farmer, still working land that has been in his family since 1892.

I sat with him and his son recently at the kitchen table in their southeastern Minnesota farmhouse on a rainy late-summer day, the healthy soil on their 500-acre corn and soybean farm soaking up the water. We talked about the struggles U.S. farmers are facing with the high cost of seeds, fuel and fertilizer outpacing crop prices.

Sommerfield, not short on opinions, offered a succinct and telling summation: “Most of the farmers aren’t farmers. They’re the farmed. They’re being farmed by the big corporations.”

That’s an apt description. To understand the perilous financial situation so many American farmers face, a situation that impacts us all, you have to understand that they operate in a vice that squeezes out any chance they have of dictating the economic terms of their own operations.

At the top and bottom of our nation’s domestic food supply sit a small handful of giant agricultural corporations. Some sell farm inputs, like seeds, fertilizer and equipment. Some control the processing and sale of what’s grown or raised.

In the middle, doing all the work, taking all the risk and cast into often-hopeless financial situations, sit American farmers, fighting to maintain a foundational livelihood often passed down through generations.

It's a fight they're in the thick of right now, as farming teeters on the cusp of an economic crisis, giving some farmers flashbacks to the lead-up to the devastating 1980s farm crisis.

The reason nonfarmers like myself should be worried about this is simple: More than 80% of the food we eat comes from the domestic supply chain. If farmers aren't doing well, the rest of us are feeling it, in everything from elevated food costs to food shortages. As I wrote in the first column of this series, when farming gets a cold, America gets sick.

Corporate control over the materials that go into farming and the processing of what comes out of farms is part of what has given present-day farming a cold.

According to Farm Action, a nonpartisan farmer-led watchdog group, 83% of corn seeds come from just four corporations. About the same percentage of nitrogen fertilizer comes from four corporations. Most beef processing is controlled by four corporations.

In 2023, the U.S. Department of Agriculture reported that just two companies – Corteva and Bayer – “provided more than half the U.S. retail seed sales of corn, soybeans, and cotton” from 2018 to 2020.

This input/output consolidation makes farmers the meat stuffed inside a sausage, pinched tight on both ends. If you're a crop farmer, there's little price competition on the input side when only a handful of companies control the market. Same with cattle farmers on the output side.

According to the USDA, the four largest firms handle "85 percent of all steer and heifer purchases."

“Corporations have all the levers. You’re no longer an independent farmer selling to someone,” said Peter Schwagerl, a farmer in western Minnesota’s Big Stone County. “You’re contract labor to go do the thing.”

Corporate consolidation on the front and back end of agriculture isn’t the sole reason farmers in America are struggling. But it’s a substantial part of the problem, and it’s emblematic of a U.S. agricultural system that – for the people who tend our land and keep our grocery store shelves stocked – seems almost built to fail.

In February, Hagen Hunt, president of the Texas Corn Producers Association, sent a letter to the U.S. attorney general expressing his concern about “concentration in the fertilizer market,” writing:

“The current state of the farm economy is dire. Texas farmers are operating on razor-thin margins – and in many cases at a loss. While the prices farmers receive for their crops have softened, the costs of the essential nutrients needed to grow them remain artificially inflated. This economic 'squeeze' is not merely a market fluctuation; it is a threat to the viability of the family farm. A threat to our national food security.”

None of this is news to folks in farming circles, or to the politicians who should be finding ways to make things better.

In July 2021, then-President Joe Biden issued an executive order that noted the woes of ag-market consolidation: “Consolidation in the agricultural industry is making it too hard for small family farms to survive. Farmers are squeezed between concentrated market power in the agricultural input industries – seed, fertilizer, feed, and equipment suppliers – and concentrated market power in the channels for selling agricultural products. As a result, farmers' share of the value of their agricultural products has decreased, and poultry farmers, hog farmers, cattle ranchers, and other agricultural workers struggle to retain autonomy and to make sustainable returns.”

But nothing of substance has changed since that executive order, another example of farmers and ranchers – who make up less than 2% of the U.S. population – being a favorite group for politicians to pander to and an easy group to later ignore.

In 2018, President Donald Trump handed out green caps at a press event that read, “Make Our Farmers Great Again!” This June, Trump declared in Wisconsin, “We love the farmers, we love everything about your state.”

But the president’s tariffs and the war in Iran have belied any love he claimed to have for farmers, driving prices on everything from fertilizer to diesel fuel to tractors through the roof and devastating farmers as they harvest this year’s crops and plan for the year ahead, again showing how wobbly a playing field they’re on.

They have to worry about weather and climate change, about commodity prices and input costs, about global affairs and about the trade decisions of whoever happens to occupy the White House.

A perfect example is President Barack Obama's bold campaign promises to reform meatpacking rules to favor smaller farm operations. Over his two terms, the reforms faced fierce opposition from meatpacking giants and were watered down into three rule changes, two of which were withdrawn when Trump took office in his first term.

Gabriel Arveson, a young farmer working with his family in northern Minnesota, faces high costs and uncertainty head-on.

“Getting into farming right now is nearly impossible unless you were born into a family farm and your family is willing to help,” Arveson told me over the phone. “If you’re picking up land at $4,000 or $5,000 an acre, and then fertilizer at $900 a ton, and an old tractor from 1985 going for $45,000. … If my family wasn't farming, there's no way you could get the capital to start a farm big enough to survive on.”

Arveson gave an example: “I have a 200-acre farm that I put into wheat, and just the fertilizer was $38,000. That's before seed, chemical application costs, fuel, land rent, insurance, trucking. And that's if you don't have anything break down, or you don't break anything in the process.”

I’ve used the 1980s farm crisis, an economic disaster that drove many farmers into bankruptcy and gutted rural American towns, as a backdrop for our present moment. I do that not because America is on the precipice of a similar crisis – though it’s possible – but because we can’t let what happened in the 1980s happen again. 

The economic circumstances now are different. The value of farmland is high, and it provides stable collateral for farm loans, as long as those values remain high.

Crop insurance is widely used, and while that’s another industry where large corporations are making money off farmers, it provides a safety net. 

But two things are important to know right now. First, most farmers, particularly small and midsize operators, are barely making ends meet, if not steadily going into debt. Second, few saw the 1980s farm crisis coming until it was too late. Our agricultural system is like a rickety tower of blocks. You don’t have to rattle any one block too hard to make the whole thing collapse.

A common refrain when nonfarmers hear about struggles in the agriculture sector is that the government is constantly bailing them out. So why worry about them?

Well, for starters, farmers would much prefer a system that allows them to do the work they love and make a living without government subsidies. That’s without question. 

Brian Kuehl, a principal at Pinion, a national advisory firm that works with the agriculture industry, said, “The farm economy has largely been supported by these massive payments of farm aid, which on the one hand are good because you don't want farmers going out of business, but on the other hand, I think they’re emblematic of the depth of this problem that the federal government is throwing billions and billions of dollars to support farmers.

"That’s not what farmers ultimately want. Farmers would rather be competing in markets, and I think everyone's uncomfortable taking payments from the government.”

And it’s not like farmers are dropping federal subsidy money into already bulging wallets. 

Deron Erickson, a farm business management instructor at Minnesota West Community & Technical College, helps about 80 farms in the state. He said that last year, the average government payment to each farm was about $100,000, and the average increase in expenses for each farm was $100,000. It was effectively a pass-through.

“Pick your farmer and say, ‘Well, you're getting all this aid.’ Yeah, but the aid is not staying with the farmer,” Erickson explained. “It’s flowing right back through to the input suppliers. Your chemical dealers, your fertilizer dealers, equipment dealers, and so forth, that are increasing their costs to the farmer again for their inputs.” 

A bipartisan group of farmers and ranchers, former USDA officials and former heads of agriculture associations came together earlier this year to form Restore American Agriculture. The group sums up the present moment nicely:

“Farm income is down while the costs of fuel, fertilizer, equipment, and labor remain high. Export markets that farmers spent decades building have been disrupted by unpredictable trade policies, creating uncertainty about where crops and livestock can be sold. At the same time, cuts to food aid programs, agricultural research, and other federal investments are reducing support for farmers and rural communities.”

Simply put, the current system is bad for farmers, and if it’s bad for farmers, it’s bad for consumers as well. Our domestic food supply is also a matter of national security, and the less diversified it is, the more vulnerable it is to interruptions.

The first Trump administration acknowledged this in a COVID 19-era executive order that directed meat processors to remain open, noting: “Given the high concentration of meat and poultry processors in a relatively small number of large facilities, closure of any of these plants could disrupt our food supply.”

As the pandemic waned, and as is so often the case in American farming, the root of the problem – consolidation and a fragile food system – was wholly ignored.

Sommerfield, the longtime farmer in Mazeppa, Minnesota, practices regenerative farming, an agricultural approach that works at restoring the health of the soil by minimizing tilling, using cover crops to keep weeds at bay and monitoring crops with precision so only areas that need added inputs, like fertilizer or weed killer, get them.

"We've got to get back to farming with nature, not against it," he said, noting how their approach to farming drastically reduces input costs. "A farm like ours wouldn't be profitable if we weren't regenerative."

In a 2022 blog post on regenerative farming, Sommerfield astutely wrote: "We see nature as God’s operating system for the planet, with many of today’s problems resulting from the bug in the works being man. So many farmers today are still locked into the corporate industrial 'till and kill' mindset that makes ag corporations rich from high input costs.

"Many on the land are not the farmers they believe themselves to be, but agricultural corporations mislead them into believing they can’t grow anything without excessive levels of industrial fertilizers, pesticides and energy."

In future columns, I’ll address how farmers believe our agricultural system can be made better, from regenerative farming to getting politicians to, as Restore American Agriculture put it in a July letter to Congress, “actively and deliberately listen to what is really happening to farmers and ranchers all across the country.”

In the meantime, I welcome any input on what you’ve read so far. 

Farming will never be the sexiest topic. It’s complex, and it’s foreign to many of us who live outside rural areas and see our food magically appear at grocery stores or markets.

But farming is that rare issue that impacts quite literally everyone in the country. Think about it next time you sit down to eat.

Doesn’t the farmer who helped put that meal in front of you deserve a fair shake? And what are you going to be eating if our food supply chain crumbles?

Email USA TODAY columnist Rex Huppke at rhuppke@usatoday.com. Follow him on Bluesky at @rexhuppke.bsky.social and on Facebook at facebook.com/RexIsAJerk.