Economic Effects: The Farm Labor Bill

CHRISTOPHER LENNEY/NNY BUSINESS

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NNY Questions: Agricultural Development with Jay Matteson

Jay Matteson, the Agricultural Coordinator for Jefferson County Agricultural CoordinatorÕs Office at the Lucki 7 Livestock Co. in Rodman on Wednesday. Emil Lippe/NNY Business

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A Change In Job, But Not A Change In Mission

Alyssa Couse

Since my last article, quite a bit has changed, both personally and within the agriculture industry. 

    First, I’d like to reintroduce myself as the new director of member services and industry relations for the Northeast Dairy Producers Association. The NEDPA Mission Statement reads: 

    “The Northeast Dairy Producers Association is an organization of dairy producers and industry partners committed to an economically viable, consumer-conscious dairy industry dedicated to the care and well-being of our communities, our environment, our employees and our cows.” 

    This not-for- profit organization serves its members by providing them with timely updates within the dairy industry, working on current issues, and supporting them and the good work they do for their land, animals, families, and their communities. One key issue that has been a focus recently is agricultural labor. The passing of the Farm Laborers Fair Labor Practices act in mid-July, which is due to take effect in January 2020, could affect some farms significantly looking forward, but the uncertainty of what the future farm workforce will look like is greater now than ever. 

    While putting together a newsletter a couple weeks ago, I read an article that has been thought-provoking ever since. The article was titled “A vision of the future dairy workforce” by Richard Stup, of Cornell University’s Ag Workforce Development team. It addressed the current stigma surrounding farm work: low skill, low-wage jobs in a high-skill, high-wage economy. This has made recruiting, hiring and retaining quality workers a tremendous challenge. The dairy industry specifically seems to be at a turning point when it comes to the future of farm labor.  

    “The future of the dairy industry in the U.S. depends on reducing or eliminating low-skill jobs and replacing them with technology and high-skill jobs. This process is well underway, with the adoption of self-guided farm machinery, group calf feeders, robotic feed pushers and automatic milking systems.” said Ricard Stup, Ag Workforce Development . 

    As technology develops and farming becomes more technical and precise, the skills needed to be successful in the industry will also evolve. Cattle genetics continue to improve and with research and development, people are better able to understand which management strategies make cows the most comfortable, most productive, and most free to do what they do best, be cows. 

    According to Dr. Stup, the future dairy farm employee will need an enhanced set of skills such as heightened critical thinking and problem solving, systems analysis, and will need to not only be compassionate and nurturing, but also well educated and data savvy. These are the skills that make for a successful middle to upper manager on farm today, but these skills will need to be characteristics of employees of all levels. 

    The agriculture industry cannot simply wait around for the next generation of ideal farm workers to emerge; the need is now. It is no secret that it is incredibly difficult for farms to attract and rely on a local labor force, especially in times of extremely low unemployment rates. Thus, the industry has had to turn to a workforce of immigrants and people of diverse backgrounds. This process is often complicated with differences in lifestyle, language barriers, and navigating through paperwork and regulations. However, most foreign workers come with an invaluable work ethic. As their birth rates decline and more opportunities arise in their home countries, U.S. agriculture is in growing need of a larger demographic of future employees. 

    So where will the rest of the future ag workforce come from? They will most likely be new to the farming lifestyle and not born into the family business like in generations of the past. Many students are studying animal science and related studies simply because they love animals and want a career with them. Like our farm managers today, future employees will need to be versatile and embrace the balance between manual labor as well as office work, such as navigating cattle health software. Some will enter the industry to fulfill their calling to feed others and desire to do an essential work. The future of farm labor will no doubt be diverse. As the industry evolves and becomes more technical, more high-skill, there’s hope that farm labor will become a sought after, fulfilling career. 

What Will Happen To Our Cows?

Jay Matteson

Being good environmental stewards is in everyone’s best interest. Clean water, clean air, clean soils are critical to life. Every industry and person should conserve our natural resources and reduce our impact on the environment, especially our climate. Let’s be clear, our climate is constantly changing. As most are aware, there is a huge debate about how much is caused by humans, to what degree natural systems cause the changes, and even to what degree our sun impacts climatic cycles. In the end, the hysterical arguments and claims damage the ability of people and industries to work together, calmly, to clean up our environment and make the world a cleaner place to live for our grandchildren. It seems sweeping bold claims and major pieces of legislation are the way, instead of common, sensical, reasonable steps forward that allow for people to adopt, adapt and embrace. 

    In the New York State Legislature there is legislation, the Climate and Community Protection Act (CCPA), that is intended to make New York State the leading state in adopting climate change legislation. The CCPA requires a 50 percent reduction in greenhouse gas emissions by 2030. By 2050, the CCPA sets a standard of zero greenhouse gas emissions within New York state. Let me say that again, within thirty years, greenhouse gas emissions will be eliminated within New York state, according to the legislation. All sectors of our economy, including agriculture, are targeted. 

    In thinking about this initiative, I immediately am concerned for our dairy processing companies. Natural gas is important to our food processing industry. How will these companies operate their plants, which employ about 300 people in Jefferson County alone, if they cannot use natural gas? Thirty years is not much time to identify new technologies that can replace natural gas in food processing. How will these companies afford transforming to new technologies? We use trucks, trains and planes to transport our raw products and value-added goods across the nation. Will we tell companies you can’t license fossil fuel powered transportation in the state but if transportation comes in from outside New York state, we allow it? Will the cost of production be driven so high in New York that these companies will shutter their plants here, possibly moving to other states? If New York causes companies to move their operations to other states where the regulatory impact is less, have we created a false utopia? Whereas, supporting research and development, and rewarding good voluntary environmental stewardship efforts, might keep business in New York state. 

    What about our cows? Many of us have heard or read about efforts to regulate cow flatulence. Will our livestock be targeted in the CCPA? Will livestock be allowed in New York state? Cows do emit greenhouse gases. I’m not aware of any filters that can be placed to control dairy air. 

    Of equal concern in considering this important issue is how will sweeping new regulations impact our average citizen’s finances. I read some reports from environmental advocacy groups about how jobs will be created because of the CCPA. Certainly, some will. The real question is how many more jobs, that the average citizen needs, will be lost because companies cant keep up with regulations and mandates? If people cannot afford to feed their families and have a reasonable quality of life, the last thing they worry about is the environment. There are very few people that will live like hermits so they can be good environmentalists. 

    As I began, so will I end. One of my favorite books is Aldo Leopold’s Sand County Almanac. Aldo is regarded as the father of conservationism. The book has much wisdom about how the environment works. It is wise to do everything reasonably possible to minimize our footprints on this planet. As big and wild as it may seem, it is still the only home we have. But we humans are here, and we must measure how we impact each other in the things we do and the regulations we pass. 

Lewis County is Dairy

 

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Homestead Organic Roots: Looking at the future of food, agribusiness and leading by example

DAYTONA NILES / NNY BUSINESS
Ed Walldroff, owner of Homestead Field, stands with his dairy cows in Lafargeville.

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The Dairy Debate: When and how will the industry change?

DAYTONA NILES / NNY BUSINESS
A few Dairy cows drink some water off of W. Martinsburg Road in Lowville.

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An Agricultural Outlook for 2018

ALYSSA COUSE

Intense anticipation for the next farm bill stems from the pressure that farmers are under due to the “kick me while I’m down” status the industry has experienced the last few years.  Low commodity prices, unpredictable weather, diminishing markets, raise in minimum wage, and just plain getting older to name a few.  While some have adapted to survive the times, others have had no choice but to sell out.  Martin Luther King, Jr., who we honor on the 15th day of this month, said “The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy.” 

                With the drought of summer 2016 leaving farms with minimal options other than to pay to drill more wells, pay for water to be trucked in, and pay for their feed commodities to be sourced in because they were unable to grow a sufficient crop on their own land, wallets were also sucked dry. Coming into the fourth year of low milk and commodity prices, farms could have used a bumper crop year in 2017 to help compensate, but instead fields were flooded by rain.  Planting and harvest was less than desirable and sometimes impossible. To learn more about making the best out of your core acres and feeding the right crop versus the best crop during tough years (among other great dairy related topics), see Joe Lawrence/Ron Kuck speak at Dairy Day Jan. 23 at Ramada Inn in Watertown. To register, call CCE Jefferson at 315-788-8450 or email me at amc557@cornell.edu

                In challenging times it is common to feel like you are alone in your struggles; this is not the case.  Financial and emotional counseling is available to help you make the best decisions for the farm and your family.  Such services are available through local organizations like Cornell Cooperative Extension, NY FarmNet, SCORE, Farm Credit, and USDA Farm Service Agency.  

How the Government could help: Farm Bill and Tax Reform

      The first farm bill was in 1933 as a response to major hardships resulting from events such as The Great Depression and Dust Bowl and they continued sporadically in the decades to come.  It was not until the 1970’s that the farm bill was taken up by Congress on a set, four–year schedule.  The latest is available for download on the USDA’s website if you’d like 357 pages worth of light reading.  The farm bill has been described with analogies like a two–engine freight train or a Swiss army knife with many tools available for use in a pocket–sized gadget.  Though these objects are drastically different, they both indicate that the farm bill is multifaceted.  It contains 12 titles and while content remains fairly constant, titles can vary from farm bill to farm bill: Title I: Commodities, Title II: Conservation, Title III: Trade, Title IV: Nutrition, Title V: Credit, Title VI: Rural Development, Title VII: Research and Extension, Title VIII: Forestry, Title IX: Energy, Title X: Horticulture, Title XI: Crop Insurance, and Title XII: Miscellaneous. Unbeknownst to most, 80 percent of the funds go to nutrition programs.

                Budget reconciliation, which allows for reconsideration of certain tax, spending and debt limitations, is important to mention in the context of the 2018 bill due to the fact that House and Senate Republican leaders have announced their intention to use this tactic at least twice throughout 2017.  Dairy, crop insurance, and commodities are among the areas stated to be in need of substantial reform.  For example, the Margin Protection Program that was created for dairy in the 2014 Farm Bill has left many dairy producers severely dissatisfied.  Many farms grow their own crops to feed their animals so improvements to these programs could have a positive impact on multiple aspects of their farm business. Several states would like disaster assistance to farmers facing droughts and other extreme weather events. Although Northern New York doesn’t have to deal with enormous wildfires or relentless hurricanes like other areas of the country, there is no doubt that drought and excessive precipitation has taken a significant toll on our local agricultural industry over the recent years. 

                In addition to the potential changes brought about by Farm Bill 2018, the new tax reform recently passed in late December could provide some relief for farmers.  A few ways the new tax bill could benefit farmers include repeal of estate tax, full expensing of certain capital investments, and lowering of tax rates on pass-through businesses, which comprises 94 percent of farms (heritage.org).  In last year’s economic outlook from Jay Matteson, an underlying message was one of hope. It seems that this sense of hope for the future has only intensified looking towards 2018.

Alyssa Couse is an agricultural outreach educator for Cornell Cooperative Extension of Jefferson County. Born and raised in the north country, she feels at home working with Jefferson County residents, both two-legged and four -legged.  Contact her at amc557@cornell.edu.

Agriculture Through the Ages: The changing, youthful face of north country agriculture

AMANDA MORRISON / NNY BUSINESS
The Porter family still owns an operates Porterdale Farms in Jefferson County, from left, Stephen, and wife, Angela, with children Landon, 11, Collin, 8, Kennedy, 6, and Katelyn, 5, David Porter, and Lisa, and husband Greg.

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Economics and agriculture in the future

Jay Matteson

I couldn’t find a fortune teller with a crystal ball so I called two people who have a good grasp on what expectations are in the dairy industry for the coming year. They are members of the informal cadre of people I turn to for guidance on what is happening in agriculture. Ron Robbins is an owner of North Harbor Dairy Farm near Sackets Harbor, a 1,000-cow dairy operation. Ron’s family owns Old McDonald’s Farm, an agricultural educational and entertainment destination.  Ron has served on a variety of state, regional and national organizations and was the state executive director of USDA Farm Service Agency for New York for a number of years.

                Bruce Krupke is the executive vice president of Northeast Dairy Foods Association based in Syracuse, serving dairy processors across eight states in the northeastern United States. Bruce also serves on many state regional and national committees. Both Bruce and Ron do a good job of keeping their finger on the pulse of the dairy industry.

                Dairy farmers have been suffering through very difficult times for the past two years.  The price they are paid for their milk, measured in units of one hundred pounds of milk shipped, or hundredweights (cwt), has been well below the cost of production.  The average cost of production in Northern New York tends to run at $18 per hundredweight or one hundred pounds of milk shipped. Prices have dipped as low as $14 per hundredweight over the last two years.  At $14, if the price stayed that low the entire year, a 500-cow dairy with each cow producing an average of 90 pounds of milk per day per cow would lose approximately $657,000 for the year. That is a significant loss.

                Mr. Robbins indicates that it is looking like prices will remain below cost of production until halfway through 2017.  Why? According to Ron there is a tremendous supply of milk and milk products on the market.  Even though demand is strong for dairy products, the low milk prices over the last two years allowed manufacturers to build a tremendous inventory of products that now has to work its way out of the system. Ron indicates that even though U.S. production continues to be “on a tear” with cow numbers increasing and production per cow moving higher, world production is coming down.  That could be very beneficial to U.S. dairy prices paid to the farmer.  Mr. Robbins believes the last six months of 2017 will hopefully see farm gate prices finally cross the profitable threshold.  Unfortunately, it will take many months for farms to recoup the losses they’ve incurred through this low price cycle.

                Bruce Krupke indicates a similar trend, anticipating prices to gradually rise into 2017.  Mr. Krupke heavily emphasized the importance of the world market for U.S. products. “This is where our future lies” Mr. Krupke said.  World dairy prices are rising enough to bring parity with U.S. dairy prices allowing our industry to become competitive. Bruce indicated that we would benefit most if we could achieve a good dairy trade situation with our neighbor to our north. Canada is putting heavy tariffs on ultra-filtered milk products that are hurting two dairy plants in New York, one in Batavia and one in Cayuga County. Bruce indicates concern that the situation will “back up” milk supply in the state.

                I also asked both gentlemen about expectations for the impacts of the Trump administration on agriculture.  Mr. Robbins said right now there is mixed expectations about President Trump.  President Trump’s pro-business tendencies are welcomed in agriculture. The last several years of intense regulatory burden, rapidly increasing cost of business due to federal policies and heavily increasing tax burdens are expected to ease and that will be very welcome. Ron said there is a nervous anticipation within the industry at the same time.  Agriculture, including the dairy industry, is heavily impacted by foreign trade.  There is concern about the unknowns of the new president’s trade policies.  Much work is being done behind the scenes to help the administration better appreciate the importance of trade to agriculture and our farms.

                Bruce Krupke shared a very positive outlook for the business policies of President Trump.  Mr. Krupke indicated he believes that the administration will be very business friendly and that should generate a positive outlook for dairy manufacturers. Bruce hopes that the president will improve our dairy trade opportunities with Canada which will especially benefit New York’s dairy industry.

                Let’s hope that the expectations of both men are correct. Our dairy farmers need a light at the end of the tunnel.  Prices have been too low for too long.   If we can improve the business climate for our farms and manufacturers, the dairy industry can thrive.  Should our business climate improve, perhaps more dairy or food manufacturing opportunities will come along.