Global Markets | Local Impacts

We receive a lot of questions from our off-farm friends like ‘really, trade with China affects you?’, or ‘why do you seem to track NAFTA negotiations like a ninja?’. So, this post is answering by rolling a number of questions into one answer.

2018 has been UNCERTAIN, and that uncertainty impacts not just farmers, but entire communities.

You can feel the impact of the uncertainty if you live in a farming community, but since this week we’re focused on reaching out to our off farm friends we want to explain what the uncertainty of 2018 means and looks like.

Let’s start with some facts:

  • Net Farm Income in the United States is projected to decline by 13% this year (9.8 billion USD) [Source: USDA August Farm Income Forecast]

  • NAFTA, the trade agreement between the U.S., Canada and Mexico that has been in place since 1994 and controls tariffs on exports/imports making up almost a third of trade, was re-negotiated to the United States-Mexico-Canada Trade Agreement which will be up for congressional vote in 2019 [Source: Council on Foreign Relations]

  • The trade negotiations with China represent over $19.6 billion USD in agricultural exports from the United States, with the change in soybeans markets meaning significant shifts for US growers, and trade changes for other soybean producing nations as the demand is fulfilled elsewhere [Source: United States Department of Agriculture]

What does that feel like if you’re in a farmers shoes?

  • Imagine losing 13% of your paycheck without any warning and you can’t change your expenses this year for your inputs…. If you are making the national average of $50k a year, you now make $43,500.

  • You have $6,500 less income to make do with this year…what do you do?

    • You stop buying and the rest of the community feels the farmers impact

      • Car dealership: Vehicle upgrade is put on hold, can’t have a car payment and hopefully no repairs

      • Sports store: Kiddos sports equipment, look for hand-me-downs from neighbors or friends

      • Appliance store: Hold off on buying the matching dryer for your washer you have to replace because it isn’t working

      • ….the ripples of the uncertainty on the farm impact the health of the entire community

Uncertainty is hard on anyone. Not knowing the impact to your individual income and knowing that the outcome is beyond your control is especially hard. Bottom line is, uncertainty has been the theme of 2018 in ways beyond the usual weather related concerns and it will impact the decisions made by farmers, their families and their communities into 2019.

We do appreciate your questions, knowing a farmer and letting us explain what this feels like is part of the privilege of Farm Femmes as a platform to share. If you have questions we really do want to help, so please feel free to comment, or reach out to us directly at teresa@farmfemmes.com or karen@farmfemmes.com.