EDUCATIONAL RESOURCE
Challenge. Change. Opportunity.
By Mark Parker
Politics, technology, tax reform,
future trends — none of them
are among the daily chores of
Missouri farmers but each figures
heavily into farm financial success.
Earlier this year, FCS
Financial brought together a
team of nationally known experts
to provide solid information on
wide-ranging topics at its biennial
Commercial Farmer Symposium.
No one has watched the
politics of agriculture more closely
over the last half-century than
Barry Flinchbaugh. The Kansas
State University professor emeritus
has been advising both sides of the
Congressional
aisle on farm
legislation
for 50 years.
Evaluating
Barry Flinchbaugh
farm policy
is his business but predicting
what will happen under the
Trump Administration has been a
challenge, he told a large crowd of
farmers.
“It has never been more
difficult than under this president,”
Flinchbaugh said, explaining that
the Trump presidency is a mixed
bag for agriculture. He gives the
President high grades for reducing
regulations that raise producers’
costs and he praises the President’s
expressed support for biofuels and
GMOs.
In the area of trade, however,
he sees the picture as more
worrisome.
Calling the Trans Pacific
Partnership (TPP) the most
potentially lucrative trade deal
ever for agriculture, Flinchbaugh
was critical of Trump’s isolationist
approach to trade and his
plan to back out of TPP while
renegotiating NAFTA.
“Trade is where we will have
the most problems with this
administration,” he said. “Twenty-
five percent of ag commodities
must be exported. I would ask
Mr. Trump which 25 percent of
America’s farms he’s going to shut
down — let’s see a plan before
you pull the plug. NAFTA is also
important and it is a net creator
of jobs when you attach economic
value — facts are facts.”
Regarding the Farm
Bill, which expires in 2018,
Flinchbaugh said not to expect
sweeping changes. It will be
debated in the context of the
overall economy, he said, but
predicted Congress will agree
to continue to support crop
insurance if food programs are also
supported.
Farm payments, he noted,
have not kept pace with
commodity price shortfalls,
however, and he is encouraging
Congress to increase farm program
funding. The new secretary of
agriculture, Sonny Perdue, knows
agriculture well and so do other
major players like Senate Ag
Committee Chair Pat Roberts and
Minority Leader Debbie Stabenow.
President Trump, however, has no
agricultural knowledge.
“That’s not necessarily a bad
thing — if he’s willing to learn,”
Flinchbaugh said.
Agriculture sits on the edge of
massive economic opportunities
in the next five to 10 years — but
it will also be a period of high
risk. That was the assessment
delivered by economist Brent Gloy,
a Nebraska farmer and finance and
farm management specialist.
The key, according to the
former Purdue and Cornell faculty
member, is positioning yourself
to capitalize while managing for
volatility. The industry, he said,
is still in a margin squeeze but
there are positive factors. Inflation
and interest rates are low, fuel
and fertilizer
prices are down
significantly and
fixed costs are
down somewhat.
In the case of
corn, that adds up
Brent Gloy
to a $50 to $60
per acre cost reduction. Current
farm income cannot support rental
rates, however, and Gloy expects
HEARTBEAT | SUMMER 2017 19