US farmers see ‘black cloud’ lifting after a crop of woes

MADRID, Iowa — In 43 years of farming, Morey Hill had seen crop-destroying weather, rock-bottom prices, trade fights and surges in government aid, but not until last year had he endured it all in one season.

Now, as Hill and other farmers begin planting the nation’s dominant crops of corn and soybeans, they’re dealing with another shift — the strongest prices in years and a chance to put much of the recent stomach-churning uncertainty behind them. The return to something more akin to normal will be a welcome change from the last two seasons that likely will be remembered as among the most unusual in U.S. agricultural history. “It will be nice to get out there and feel good about what you’re doing,” said Hill, who farms 400 acres near the small Iowa community of Madrid. “I don’t have a black cloud hanging over me.”

It’s hard to overstate how bizarre the past two seasons have been for farmers, who for the previous six years had repeatedly produced near-record harvests but saw little profit because commodity prices were so low. The situation worsened after then-President Donald Trump launched a trade war with China that reduced demand and lowered prices, but Trump then blunted the impact with $16 billion in agricultural aid. Last spring, farmers’ hopes for a more normal season were initially wiped out by the pandemic, which disrupted domestic markets, slowed shipping to other countries and devastated demand for cornbased ethanol as people stopped driving. Hundreds of Midwest farmers last August also were hit by a wind storm, called a derecho, that flattened 850,000 acres of crops, including 90% of Hill’s corn and soybean crop.

The federal government then offset those hits with $50 billion in various kinds of aid to farmers plus crop insurance payments.

That infusion of aid continued even as U.S. agricultural exports recovered midway through the year, eventually soaring to $146 billion, the second highest export total ever, according to the U.S. Department of Agriculture. The main reason was big increases in exports of soybeans, corn and pork to China.

The USDA has forecast that those agricultural exports will remain strong later this year, and coupled with greater demand for livestock feed and ethanol, corn prices have roughly doubled from just over $3 a bushel in spring 2020 to about $6 a bushel now, the highest price in eight years.

But despite the positive signs, income could drop this year for some farmers because the federal government doesn’t plan to continue the billions of dollars in special payments that offset tariffs and coronavirus problems, though generous programs like subsidized crop insurance will continue.

USDA Chief Economist Seth Meyer predicted in February that net farm income would decline about 8% because of a roughly $20 billion drop in direct farm payments.