[OKC] Fields of Grain and Losses

[Shauna Struby]

In today's NY Times, a story filed from Walters, Okla. .

 

November 21, 2008

The Food Chain


Fields of Grain and Losses 


By DAVID STREITFELD
<http://topics.nytimes.com/top/reference/timestopics/people/s/david_streitfe
ld/index.html?inline=nyt-per> 

WALTERS, Okla. - The farmers said it would not last, and they were right.

When the price of wheat, corn, soybeans and just about every other food
grown in the ground began leaping skyward two years ago, farmers were
pleased, of course. But generally they refused to believe that the good
times would be permanent. They had seen too many booms that were inevitably
followed by busts.

Now, with the suddenness of a hailstorm flattening a field, hard times are
back on the American farmstead. The price paid for crops is dropping much
faster than the cost of growing them. 

The government reported this week that the cost of goods and services
nationwide fell by a record amount in October as frantic businesses tried to
lure customers. While lower prices are good for consumers in the short run,
a prolonged stretch of deflation
<http://topics.nytimes.com/top/reference/timestopics/subjects/d/deflation_ec
onomics/index.html?inline=nyt-classifier>  would wreak havoc as companies
struggled to stay afloat. 

In this lonesome stretch near the Texas border, farmers are getting an early
taste of a deflationary world. They have finished planting next year's
winter wheat, turning the fields a brilliant emerald green. But it cost
about $6 a bushel in fuel, seed and fertilizer to put the crop in. That is
$1 more than they could sell it for today, and never mind other expenses
like renting land.

This looming loss sharpens their regret that they did not unload more of
this year's crop back when they harvested it in May. They knew the boom
would end, but not so soon. 

"I waited all my life for wheat to go from $4 to $5," said Jimmy Wayne
Kinder, a fourth-generation farmer. "Then it hit $10, and we were all
asking, 'What are we going to do?' "

Mr. Kinder, who farms about 5,000 acres with his father, James Kinder Jr.,
and his brother, Kevin, held onto much of his wheat, hoping that prices
would go still higher. Instead, they plunged. "I lay in bed at night kicking
myself," Mr. Kinder said.

The farmers in Walters still have to worry about drought and floods and
grain bugs and army worms, as they have for decades, but they have new
anxieties beyond their control: Manic commodity markets. A rising dollar
that makes their crops more expensive overseas. And - an urgent new concern
this fall - the solvency of their banks. 

More here ::: http://www.nytimes.com/2008/11/21/business/21farm.html?_r=1
<http://www.nytimes.com/2008/11/21/business/21farm.html?_r=1&th&emc=th&oref=
slogin> &th&emc=th&oref=slogin 

 

::: shauna lawyer struby

P please don't print this e-mail unless you really need to

 

 

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