Miami
14 May 2008
As crop prices remain high, farmers and other landowners are working to expand their output and take advantage of big profits for wheat, corn and soybeans. The boom is creating pressure to begin farming on lands enrolled in U.S. environmental programs intended to rebuild native prairie and wildlife habitats. VOA's Brian Wagner has this report.
Rising crop prices are creating concern about the price of food at markets around the world. But for farmers of wheat, corn and other crops, the potential for reaping new profits is hard to overlook.
The U.S. Department of Agriculture (USDA) estimates farmers around the globe are seeking to take advantage, with output of wheat, rice and other grains expected to rise this year. Officials say global wheat production will reach a record level over the next year, up seven percent from last year, thanks to favorable weather conditions and record market prices for wheat.
The United States is the world's top wheat exporter, and much of it grows in a region known as the grain belt where farmers are looking at ways to grow more.
Erica Peterson, marketing specialist with the North Dakota Wheat Commission, says some landowners in the state are now farming lands that had been left idle or enrolled in conservation programs.
"Whereas a few years ago it was probably more profitable to leave that land idle, when wheat prices were $3 or $4 [per bushel]," she noted. "Now if they can get $8, $9, $10 for their wheat, it is obviously more economical to use that land to grow a crop."
In North Dakota and other states, the challenge is finding good farmland that is not already being used for agriculture or for other ends.
Bruce Babcock, director of the Center for Agricultural and Rural Development at Iowa State University, says the push to expand U.S. farmland began last year and is picking up steam.
"We've seen [crop] prices increase in the last year 20-30 percent and we only got a one percent increase in land," he noted. "This year we're seeing a price increase of another 40 or 50 percent and I would be surprised if total land planted in the United States is up more than two or three percent this year."
One of the biggest possible sources of new farmland is the 14 million hectares held in a environmental program known as the Conservation Reserve Program. The federal program is to pay out nearly $2 billion this year to landowners in exchange for planting grass, shrub or trees to benefit the local environment. Advocates say the effort combats soil erosion, improves air and water quality, and provides habitats for native birds and other wildlife.
Last year, the 10-year contracts of some program members came up for renewal, and scores of farmers in grain-producing states decided to leave the program and begin farming wheat, corn or other crops. North Dakota lost more than 165,000 hectares in conservation, more than any other state in the country.
Jim Jost is a conservation program specialist in North Dakota for the Farm Service Agency, which administers the program.
"You can see our highest losses in North Dakota are in the south-central part of the state and that seems to be influenced more by increased corn and soybean production in that area," he said.
Jost says the decision to leave the program is difficult for landowners committed to environmental concerns, but he says there is a strong economic incentive as long as crop prices are high.
Part of the blame for high food prices is the development of alternative energy supplies, such as ethanol from corn in the United States. Nature groups say the development of biofuels threatens to reverse some of the environmental benefits of the Conservation Reserve Program, which was launched in 1985.
Scott Stephens is director of conservation planning for Ducks Unlimited, which helps preserve and restore wetlands for waterfowl. He says the Conservation Reserve Program has had a profound impact in the grain belt and elsewhere.
"Now we see all of those positive impacts that were all funded by taxpayers over the past 20 years are disappearing, are being washed away in a rush for new sources of energy via biofuels," he said.
Bruce Babcock says one alternative to pulling more lands out of conservation is to look outside the country for potential farmlands elsewhere, especially Brazil, Russia and parts of sub-Saharan Africa. He says Brazil alone has the potential to develop up to 100 million hectares in new cropland.
He says those kind of decisions hinge on foreign policy as well as environmental concerns.
"If we place a very high value on domestic wildlife habitat, then we would suggest that it would be better to develop land overseas," he added. "If we don't care so much about our domestic wildlife habitat, then we should concentrate on developing our own land first."
Either way, Babcock says he does not expect crop prices to remain high, because farmers in the United States and elsewhere already are working to increase production.