Wisconsin Farmers Continue to be Cautiously Optimistic

Wisconsin Farm Bureau Federation

By Kevin Krentz, WFBF President

It’s often said, you have to be an optimist to be a farmer. While there is a lot to be thankful for as we head into 2023, there are also a lot of concerns lingering for Wisconsin farmers who experienced a year of great turmoil and change. But alas, it’s time to look ahead to a new year.

The past year brought a war in Ukraine, severe drought pockets in the western portion of the U.S., intense market volatility, as well as inflation that we haven’t experienced in 40 years. These have drastically complicated the commodity markets in the U.S.

At the farmgate, we have seen increased prices for the commodities we produce, but like other industries, we also experienced increased costs for everything from tractor parts to seed and fertilizer. In general, there is optimism for 2023 because of the global demand for products, but there also is skepticism among farmers.

Farmers are good at controlling what we can control. Many farmers use forward contracts on both production and purchased inputs or protect their margins through insurance or hedging. Through good management, we also need to nurture our crops and care for our livestock. Balancing business needs is a major focus and seems to get more complicated by the year.

According to the U.S. Bureau of Labor Statistics, the current annual inflation rate for the U.S. for the 12 months ending October 2022 stands at 7.7%. Generations of farmers have not experienced rates at this level. Add to that the supply chain challenges that have affected equipment purchases and building expansions, and we have some large stress points within the agricultural community.

Higher interest costs and current land prices also make it challenging for beginning farmers to enter the industry, which will continue the trend of consolidation.

Like many other industries, another issue farmers and agribusinesses face is a severe lack of employees. The BLS also reports that Wisconsin’s October unemployment rate was at 3.3%. Labor shortages will continue to drive innovation and automation as farms find ways to become more efficient with limited workers. Once politics settle, a focus on immigration reform will be revisited.

Our state’s farmers not only supply locally but are a large part of the global food supply.

Farm Bureau has long advocated for reducing trade barriers globally and will continue to do so. The current geopolitical environment will continue to change our trade maps moving forward, but U.S. farmers can compete with other global food producers when presented with barrier-free trade.

On the consumer front, food prices are constantly a focus and talking point. Some of the higher costs at the farm level are being passed to customers at the grocery stores. This is driving the demand for certain products and consumers wanting to know where and how their food is grown and raised.

Within the consumer conversation, we are continuously evaluating our practices when it comes to conservation. However, in order to be sustainable, we cannot regulate farms out of business. Farmers must be able to afford to adapt to the ever-changing government regulations and industry requirements while being able to try new things that might better our resources. Wisconsin farmers are some of the most progressive at this throughout the country. We have made great progress and will continue to lead innovation.

Wisconsin agriculture consists of 64,100 farms on 14.2 million acres and annually contributes $104.8 billion to our state’s economy. Much of which is spent within the state’s rural communities.

Wisconsin Farm Bureau has advocated for farmers for more than 102 years and as farming continues to adapt to feed the world, Farm Bureau will continue to adapt to support our farmers.

Every year, through our grassroots process, Farm Bureau voting members at the county level bring forth policy that guides our organization at the local, state, and national levels on issues affecting our members. There is no shortage of topics to be discussed for our farmers.

As a new year and political cycle begin, you can expect many of these topics to be discussed.

There is optimism for the new year because, by nature, farmers are hopeful people. We will see what the truth holds in the next 12 months as 2023 unfolds.

Wisconsin Farm Bureau Federation is the state’s largest general farm organization, representing farms of all sizes, commodities and, management styles. There are more 46,000 members that belong to WFBF. Voting Farm Bureau members annually set the policy the organization follows, and are involved in local, state, and national affairs, making it a true grassroots organization.