"Prices are sky high." Surging inflation latest challenge to NC farmers

Monday, December 27, 2021
Surging inflation latest challenge to NC farmers
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A meteoric rise in fertilizers is forcing North Carolina farmers to re-evaluate and potentially overhaul their entire operations.

KENLY, N.C. (WTVD) -- A meteoric rise in fertilizers is forcing North Carolina farmers to re-evaluate and potentially overhaul their entire operations.

"I paid $240 a ton last year and my price the other day was $550," said Susan Ford, a Johnston County farmer. "That's a 130% increase at $82 an acre. Prices are sky high."

Across the country, the U.S. Department of Agriculture forecasts an additional $3.1 billion spent on fertilizers, lime and soil conditioners - an increase of 12.5%.

While analysts point to several factors, including supply chain issues, many economists point to inflated prices on natural gas that is among the more prominent reasons for the discrepancies. According to Ford, the natural gas is a key ingredient in ammonia and nitrogen fertilizers.

"It makes you wonder; how much longer can you sustain prices like that?" said Ford, a sixth generation farmer. "We'll have to find a way to make it work."

Ford's farm in Johnston County is nearly 2,000 acres and its crops include tobacco, wheat, cotton and corn. Though this past year was a bountiful one, Ford explained that family farms lack the kind of leverage to negotiate with buyers like feed companies and food processors to seek higher rates.

"Ask my Dad, he'll tell you the price of tobacco 20 years ago is the same price now," said Ford.

Shawn Harding, President of the North Carolina Farm Bureau, further explained that rising costs typically lead to higher prices for consumers, and farmers don't always see those returns.

"That sweet potato or that gallon of milk had to get to the grocery store," said Harding. "so, if it costs more to get from the farm to the grocery store, that's extra added costs that maybe the grocery store adds on that the farmer won't see. We're partners in this: the farmers, the truckers and grocery stores. We hope it'll all work out but it's not as simple as one plus one equals two."

NC Agriculture still a giant industry - but it's changing

While tech, biotech and manufacturing have earned much of North Carolinas economic headlines in 2021, agriculture remains the most prolific industry in the Tar Heel State: nearly $96B and 789,000 jobs, according to an analysis by N.C. State University.

"We become a different state, we become a different culture and a different people if we lose agriculture," Harding said. "You know farms are small businesses and in these communities they help the whole community be prosperous."

Roughly 96% of farms in North Carolina continue to be family-owned and operated, but the number of farms in the state continues to fall. Though the next Farm Census will take place in 2022, the current estimates for total farm operations in North Carolina is around 46,000 - down at least 400 since 2017, more than 4,000 since 2012 and nearly 15,000 less since 1997.

The average age of a North Carolina farmer, meanwhile, is 58.1 years old.

At the Farm Bureau, leaders are urging farmers to adapt to the changing marketplace and find new opportunities, including going direct-to-consumer.

"Our consumers like that," said Harding. "And then the farmer can ask for a price that they need to survive and the consumers like knowing their farm and who their farmer is. I hope we can change the model a little bit, and I think that's the way we can be successful and coexist with agriculture and a growing population in North Carolina.

Still, farmers like Susan Ford say that's easier said than done, especially for farms in deeply rural North Carolina. Farms also can embrace new technology and apply more precision-based fertilizer use to save money, but that first requires a tremendous investment on new planters, sprayers and other infrastructure.

"I'm avoiding savings questions because we don't have savings," said Ford. "It takes every bit of money we bring in to survive."

"I think special people are farmers. We're able to figure out a way to fix it and keep going." said Ford, he has no desire to give up.