This year, drought is contributing to the largest abandonment of winter wheat acres since 1917 and the shrinking of the U.S. cattle herd, now the smallest in 60 years. In addition to increased drought, climate change is driving rising temperatures, wildfires and torrential rains, and is already affecting food production in the U.S. Yet, as Congress works on a new five-year Farm Bill, there are few signs that members grasp the urgency of the climate crisis and the need for dramatic policy shifts to address escalating challenges for both farmers and consumers.
Last week, the Campaign for Family Farms and the Environment (which includes family farm groups in Minnesota, Iowa, Missouri, and South Dakota, plus IATP and Food & Water Watch), published a new report outlining how the Farm Bill could help protect the country’s food supply, stabilize agriculture markets with fair prices for farmers and promote greater climate resilience in our food system. The report examines proposed farm policies that include grain reserves, a price floor and ceiling, and a set aside program to better manage supplies of key agriculture commodities like wheat, corn and soybeans. When integrated with popular conservation programs that support practices, such as more diverse crop rotations, perennial grasses, regenerative grazing or cover crops, these policies would make progress toward protecting the food system against incoming climate shocks. These proposed policies also would remove a critical subsidy in the form of cheap, below-cost feed to a high greenhouse gas emitting factory farm system of animal and dairy production.
The research by agricultural economist Dr. Daniel De La Torre Ugarte found that a set of supply management policies would greatly moderate agriculture commodity prices for wheat, corn and soybeans over the next 10 years — allowing farmers to access better prices from the market (instead of relying on costly government subsidies) while protecting consumers from price spikes. The research was based on proposed farm programs that set a price floor for commodity crops pegged to ensure farmers are paid fairly and can cover their cost of production. If market prices drop below that price floor, the government purchases the crop and starts to fill a reserve until prices stabilize. If prices rise above an assigned price ceiling, the government releases the reserve onto the market until prices stabilize.
Today, in the U.S. and around the world, governments routinely help manage food supplies and prices. The current sugar program within the Farm Bill sets supply levels and price supports each year. Earlier this month, the USDA announced it would purchase $50 million worth of pork because excess production had driven prices down for pork producers. Canada has robust supply management programs for dairy, eggs and poultry. Countries like China or Vietnam have food reserves to protect against shortages and disruptions in global supply chains. During the last food price crisis from 2008-12, countries around the world explored variations on reserves to better manage food supplies. (IATP published a reader on the topic.)
The original set of Depression-era farm policies utilized a suite of supply management tools to achieve parity prices for farmers (see a great history here). After decades of attacks by agribusiness on those original policies, documented in the seminal IATP analysis Crisis by Design, Congress finally removed the last vestiges of supply management in the 1996 Farm Bill. However, the ideas behind the program remain relevant. In 2012, the National Farmers Union proposed a variation of a supply management program, called the Market-driven Inventory System, and the Texas Farmers Union advanced a similar proposal in 2018. In 2021, over 90 groups led by the National Family Farm Coalition called for a dairy supply management system to restore market fairness for small and mid-sized dairies.
The escalating climate crisis introduces a growing risk to agriculture production and our food supply. The most recent U.S. National Climate Assessment outlines what is coming for our food system, including increasing drought, wildfires, the depletion of water supplies, and new pests and diseases for crop and livestock production.
Supply management policies attempt to address a prickly challenge for farmers, extreme volatility in crop prices, where in most years farmers are paid below their costs. This constant economic pressure, softened by subsidy payments, is often a barrier to farmers wanting to make long-term investments in agroecological farming systems that can take three years or more to pay off and don’t have the same safety net programs as commodity crop production. Agroecological farming, which can include more crop diversity, the integration of animals and an emphasis on biodiversity can build more resilience against climate-induced weather changes and emit fewer greenhouse gases. Any future supply management system should be coupled with greater access to conservation programs that can help farmers integrate agroecological practices that build soil health and benefit the water and air, while expanding biodiversity on the farm.
In its introduction to the research, CFFE also emphasized the need to address a history of racial discrimination at the USDA in administering past supply management programs, where many farmers, including BIPOC and non-landowning farmers, were blocked from participating.
It is also critical that any supply management system include reforms to trade rules, which can be used to challenge efforts to protect domestic markets (see the U.S. challenge of Canada’s dairy program) and be considered as part of a regional system of grain reserves that works cooperatively with other countries.
Too often, when writing a new Farm Bill, Agriculture Committee members seek the least controversial compromise inches from the status quo to get the bill passed. In many ways, the Farm Bill process is designed to discourage bold reforms that take on big challenges, particularly if it involves shifting the power dynamics of a food system dominated by a handful of corporations. But climate change doesn’t care about Farm Bill politics, or whether policymakers had the foresight to establish a wheat reserve. This year, due to an extended drought, the nation’s wheat state, Kansas, will have to import wheat to feed its mills for the first time ever.