Congressman Brett Guthrie was in Owensboro Friday and met with local grain farmers to hear about issues facing the agricultural community and to provide an update regarding legislature that affects farming.
Jason Strode, a west Daviess County farmer, plants 5,000 acres annually, alternating between corn and soybeans. He made time during his busy season to meet with Guthrie to hear an update on trade legislation that has been affecting his farming business.
Strode said crop prices continue to depreciate. As of Friday, yellow corn was sold at $3.80 per bushel and soybeans were sold at $8.28 per bushel, which is nearly $1 less per bushel than just a month ago and $2 less than last year. Along with dropping prices, demand for both crops are dropping too.
“At one time one in three soybeans was exported to China,” he said. “Now none are, cutting demand by a third. And other countries are ramping up their production and taking market share. We don’t have willing buyers for as much of our product.”
One farmer at the table said he plans to double up on corn next year with soybean prices being as low as they are this season, but he said if other farmers do the same the U.S. could have a very serious issue.
American agriculture has felt the effects of the trade war between China and the U.S. Most recently, China has threatened to impose additional tariffs on $75 billion in American goods, including soybeans.
“China is not picking on agriculture,” Guthrie said. “Our agriculture is so efficient, we produce food at the cheapest price. That’s just what they import into China, so when they put tariffs on what we export to them, agriculture gets a bigger brunt of it.”
If the decline in soybean prices extends another year or more, Guthrie is concerned that China will find other countries to replace what was previously supplied by the U.S.
“We need trade with China, but it needs to be fair,” he said, agreeing with Trump’s decision making to ensure China does not take advantage of the U.S.
Guthrie told the farmers present for the roundtable discussion that he believes President Trump is close to a deal with China.
But Strode is skeptical. He said the uncertainty of trade and the price depreciation of his crops has prevented him from expanding his farm.
“If we have opportunities to expand, we are not even exploring them at all,” he said. “It’s no man’s land. We have no idea what to expect.”
Strode told Guthrie that he has a hard time with understanding the President’s decisions and policies.
“I follow the President everyday on Twitter,” he said. “Tuesday he is saying something and Wednesday he is totally backtracking on everything he just said.”
With the uncertainty of the crop they traditionally grow, Guthrie asked the group if the hemp farming has been a solution to grain farmers since the passing of the Farm Bill. The short answer was no. Some farmers said the expense of the crop is prohibitive and banks are not willing to loan money for hemp crops, while others worry that hemp’s main product, CBD oil, is just a fad.
Daviess County Extension Agent for Agriculture and Natural Resources Education Clint Hardy said the problem with CBD oil is the fact that it is not tested or regulated by the Food and Drug Administration.
“We hope that this stuff is the next best Tylenol that should be in the cabinet of every American homeowner,” Hardy said. “But the product right now is legally sold as a food supplement. That’s how they get under the radar to be on gas station shelves. There’s no longevity in that.”
Guthrie, who is on the subcommittee that oversees the FDA, said there is no decision in the near future on CBD regulation by the FDA.
Because hemp is so recently legalized, Guthrie said officials are “trying to catch up with the rules on it.”
“FDA is going to have a role,” he said. “They are internally looking at the rules. It has been legal for well over six months now, but for agencies in D.C., that is still new to them.”
Guthrie said hearing stories of Kentuckians that are affected by the policies put into action in Washington D.C. helps when he speaks with members of the executive branch that are making the decisions.
“You have these stories and they are real, they’re real people,” he said. “It’s not just out of an economics book.”