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RAFI-USA receives SARE planning grant for "Agriculture in the Middle"
Virginia Tech, NC State release results of peanut profitability study
Tobacco Farmers Are Finding Alternatives
Action Alert: The Fair Contracts for Growers Act (S. 91)
Seeds & Breeds Proceedings available on RAFI-USA website.
"Who Owns Organic?" available in Spanish on RAFI-USA website

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RAFI-USA receives SARE planning grant for "Agriculture in the Middle"

By Scott Marlow

The Rural Advancement Foundation International USA has received a USDA Sustainable Agriculture Research and Education Program planning grant for developing a task force to reinvigorate agriculture of the middle in the south. An offshoot of the National Task Force to Reinvigorate Agriculture of the Middle, this project will address the needs of farmers with operations that are too large to access direct markets, but are too small to be able to compete on undifferentiated commodities markets.

According to the US Census of Agriculture, between 1997 and 2002, the number of farms in the U.S. between 10 and 49 acres increased by 6.2%, and farms larger than 2000 acres increased by 4.7%. However, the number of farms between 50 and 179 acres decreased by 5%. Farms between 180 and 499 acres decreased by 13%, and between 500 and 999 acres dropped by 10%. These "farms of the middle" are rapidly being lost, and the social and environmental benefits that these farms provide will go with them.

In 2003, Fred Kirschenman of the Leopold Center for Sustainable Agriculture at Iowa State University and Steve Stevenson of the University of Wisconsin-Madison convened the Task Force for Agriculture of the Middle. This task force has been meeting throughout 2003-04 to examine the challenges of developing enterprises that support farms of the middle, and the policy implications of this trend.

Initial results of this discussion demonstrate the complexity of the issue, and that effective responses require multi-disciplinary, integrated approaches that encompass production systems, marketing methods and infrastructure, and policy implications. This task force is currently drawing on case studies from around the country to examine how successful enterprises are structured and developed, and how they can be supported in the policy arena. This task force is gathering an extensive amount of information from across the country.

The southern task force will address production, policy and marketing aspects of agriculture of the middle, drawing on the work of the national task force, and the extensive experience of individuals within our region. If you are interested in this initiative and would like to participate, contact Scott Marlow at smarlow@rafiusa.org.

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Virginia Tech, NC State release results of peanut profitability study

By Scott Marlow

A recent study by agricultural economists at Virginia Tech and NC State compared "representative farms" based on the top 10% of peanut producing farms from the top peanut producing counties in six states. Representative farms were developed for North Carolina, Virginia, Georgia, Alabama, Florida and Texas based on focus groups with farmers, extension agents, and other experts.

In the study, all producers of non-irrigated peanuts received prices below the cost of production, but received commodity payments that made up for this difference. Overall, dependence on Federal Commodity payments increases dramatically. Government payments were more than 100% of the net return for 5 out of 6 of the farms, showing that prices were below the cost of production for all but one of the farms.

Whole farm profitability analysis showed that, even with increased commodity payments for peanuts and cotton, net family cash which includes net farm income, off-farm income, family living expenses and debt payments, is negative for three of the six farms (Virginia, North Carolina and Alabama). The Florida farm retains $443 in net family cash, the Georgia farm retains $19,313 and the Texas farm retains $45,699. It is important to note that these examples are representative of the top 10% of farms in their area in terms of production and efficiency.

The authors concluded that for peanuts to be profitable under the 2002 Farm Bill, farmers must control peanut base and all associated payments, must have least-cost equipment, must reduce production expenses and must be able to average over 3,200 pounds per acre for non-irrigated peanuts, and 3800 pounds per acre for irrigated peanuts. The 10 year average peanut yield in NC is 2,780 pounds. The state average yield has matched or topped 3200 pounds twice in 10 years.

The study is available at: http://www.ces.ncsu.edu/depts/agecon/peanut_econ/FarmBill.html.

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Tobacco Farmers Are Finding Alternatives

By Jason Roerig

There are big changes happening on tobacco farms these days.  "Tobacco was the only thing that had any profit.  The quota cuts have made it harder to make ends meet all the way around," explains Allyson Strickland, a Columbus County farmer.  The prospect of a tobacco quota buyout provides some hope for relief for farmers who have seen the amount of tobacco they produce cut by more than 50% in recent years.  However if the buyout doesn't come through, tobacco growers will be looking at another big quota cut and a corresponding loss of income.  Strickland's husband Eddie says, "If the buyout comes or not, we will not start a tobacco crop next year."

The Stricklands have farmed in Columbus County since 1982.  Tobacco was a mainstay of their operation, but recently, they've been relying more heavily on other crops.  "We see more of a future in produce and livestock than we can in tobacco," Strickland says.

The Stricklands run a farm stand off of highway 904 west of Tabor City where they sell vegetables they grow on the farm, and now they're expanding their operation in a new direction˜agritourism. Directly behind the farm stand is a lush green field of corn that is about to be cut into a corn maze. Strickland explains their decision to diversify into agritourism this way, "A lot of people are looking for simple entertainment˜someplace not expensive to carry the kids."  With assistance from RAFI-USA's Tobacco Communities Reinvestment Fund, the Stricklands are hoping to meet the needs of people to reconnect with farming and have fun.

RAFI-USA's Tobacco Communities Reinvestment Fund was started in 1997 to assist farmers and communities replace lost tobacco income. The program offers cost-share grants and technical support to assist farmers and communities develop innovative, new farm enterprises.  In 2004, with the support of the Tobacco Trust Fund Commission, RAFI-USA awarded $193,000 for projects benefiting farmers in twenty-four North Carolina counties.
 
Agritourism enterprises, like a corn maze, are one possible opportunity to help replace some of the income that has been lost from tobacco in recent years. The Strickland's efforts have not gone unnoticed by state agritourism officials.  The Strickland's are part of an effort to develop an agritourism network in the state and were featured on the North Carolina Farm Writers and Broadcasters association tour on Saturday, August 20.
 
The challenges faced by farmers and rural communities in this changing economy are great.  However as Betty Bailey, RAFI-USA's executive director, explains, "There is no shortage of good ideas among farmers." Thanks to the Tobacco Trust Fund Commission, the Tobacco Communities Reinvestment Fund is giving farmers and communities the opportunity to put their ideas to work.

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Action Alert for The Fair Contracts for Growers Act (S. 91)

By Laura Klauke

It's not too late!! Ask your Senators to support farmer's rights and cosponsor S. 91.If you haven't made a call on this issue yet, NOW is a great time.Congress is reconveneing September 7th and getting back to business. 

Please call your Senators today. Ask them to cosponsor S. 91. You can reach any member of Congress by calling the Capitol Switchboard at 202-224-3121. The number is often busy, so just keep trying. If you would rather use the web to look up contact information: http://congress.org/congressorg/home/.

Ask to speak to the Senator's agriculture staff person. If you get voice mail just leave a message. Ask your Senators to protect the rights of farmers and keep arbitration truly voluntary. Ask your Senator to cosponsor S. 91.

You can mention that the Senator should have received a Dear Colleague letter from the bill sponsors, Senators Grassley and Feingold, outlining many of the problems with arbitration. Note that you hope the Senator will pay attention to this letter and the information provided because arbitration is a critical issue for farmers and the rural communities they support. (To view the Dear Colleague letter visit the RAFI-USA website - http://www.rafiusa.org/whatsnew/GrassleyFeingold_letter.html).

If it is easier, you can also just fax your Senator the text of Grassley and Feingold's letter and include a cover page saying you hope your Senator reads this letter and will sign on as a cosponsor of S. 91.

Background: The Fair Contracts for Growers Act (S. 91), sponsored by Senators Grassley (R-IA) and Feingold (D-WI) provides for greater fairness in livestock and poultry contracts.The bill ensures that the decision to arbitrate is truly voluntary and that farmers are not coerced into waiving their rights. It specifies that if a livestock or poultry contract provides for the use of arbitration to resolve disputes, arbitration may be used to settle a dispute only if, after the dispute arises, both parties agree in writing to use arbitration. The poultry experience shows that forced arbitration clauses effectively prevent farmers from resolving a dispute in court - even in the case of extreme fraud or illegality on the part of the company. Instead farmers are forced into a forum that is biased against them. Arbitration can be very expensive and beyond the means of most farmers. A grower in Texas was recently billed over $20,000 for her portion of the initial costs, with payment due before the arbitration process could begin. In comparison, court filing fees run around $200.

The arbitrators are unlikely to have any knowledge of the industry or the complexities of grower payment methods. Their decision and its basis do not even need to be given in writing. In general, neither the grower nor the company has the right to appeal to anyone, including the courts, if they believe the decision is flawed.

An amendment to the Senate 2002 Farm Bill identical to S 91 enjoyed strong bipartisan support and passed with a 64 to 31 vote. (It was later dropped in conference.) A similar measure that provided voluntary arbitration in contracts between car dealers and car manufactures passed as part of a larger appropriations package and is now law.

If forced arbitration is not stopped in livestock and poultry contracts, it could easily spread to other sectors of agriculture where contract production is just beginning. Arbitration can be a useful tool if it is a mutually agreed upon method of settling a dispute. However, the law should not permit large companies to use arbitration to deny family farmers access to justice.The lead sponsor of this legislation is Senator Grassley of Iowa. The bill has been cosponsored by:

Sen Feingold, Russell D. [WI]
Sen Harkin, Tom [IA]
Sen Enzi, Michael B. [WY]
Sen Leahy, Patrick J. [VT]
Sen Johnson, Tim [SD]
Sen Edwards, John [NC]

To read S. 91: http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=108_cong_bills&docid=f:s91is.txt.pdf .

To see which Senators voted for the Senate Farm Bill amendment providing greater fairness in the arbitration process for livestock and poultry farmers: http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=107&session=1&vote=00366.
(Remember that since this vote occurred in the previous session, Senators elected in 2002 will not be listed. Be sure and thank any Senator that voted for the amendment and remind him or her S. 91 is
basically identical to that amendment.)

To see which Senators cosponsored legislation to provide greater fairness in the arbitration process for car dealers: http://thomas.loc.gov/bss/d107query.html and search for Bill S. 1140. (Remember that since this bill was introduced in the previous session, Senators elected in 2002 will not be listed.)

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New RAFI-USA publications available on the website

Proceedings of the Summit on Seeds & Breeds for 21st Century Agriculture now available.

"Who Owns Organic?" now available in Spanish.

All publications can be accessed at http://www.rafiusa.org/pubs/puboverview.html.