Clearing Supply Chain Hurdles

We live in an instant age here in America. From fast food to same-day delivery, we have gotten used to not waiting long for most things. But not everything has a quick-fix option, and there’s certainly no such thing as instant farming. When something breaks down on the farm, it takes time to repair. When disaster hits, recovery doesn’t come in minutes but months, sometimes years. As a nation, we’re on that long road to recovery together as supply chain disruptions continue to ripple through our economy. Yes, America’s farmers and ranchers are still farming. No question. But empty shelves and rising food costs have everyone concerned and looking for solutions.

The pressure of rising costs is being felt by farmers and ranchers too. Food cost inflation doesn’t make its way back to farmers’ pockets in the form of higher payments for their products. Only about 8 cents of every consumer food dollar goes to the farmer, after marketing costs. Meanwhile, the cost of farm equipment and other critical tools like fertilizer have increased—if those items can be found at all.

I’ve painted a bleak, yet realistic, picture here, but my message is that we’re determined to overcome the hurdles. We are working with our nation’s leaders to address these challenges. USDA’s announcement this week of an innovative solution to get agricultural products moving again through the port in Oakland, CA, is a great example. It will take time and investment to continue fine-tuning the supply chain and rebalancing the economy, but it can be done. As we shift from our highly efficient “just in time” system to build up more “just in case” inventory to stabilize the economy and protect our food supply, we need to develop both immediate and long-term solutions.

The problems facing our supply chain will take time to address fully.

Top of mind for farmers across the country is relief from rising farm costs. Fertilizer prices have sky-rocketed (up 300% in some areas)—and the added impact of these costs on the rest of the food chain will not be far behind. While there are several factors at play here, there are actions the Biden administration can take to help the situation. The American Farm Bureau has urged the administration to look for ways to bring fertilizer prices down, which include resolving supply chain issues and removing import duties. Going forward, we must also focus on trade agreements that break down harmful barriers and restrict access to critical tools for America’s farmers and ranchers.

It’s time to increase efficiency and reliability across commercial shipping channels, from our roads and rails to our ports and waterways. The recently passed bipartisan infrastructure package will be critical in making long-term overdue improvements that will keep our food supply moving across the nation. More can be done by the administration now, however, in bringing industry leaders to the table to find solutions to reduce backlogs and delays—whether that be through increased competition or innovative solutions to improve efficiency.

The labor shortage has also hit the food chain hard, especially when it comes to finding enough long-haul drivers to transport food products. But as more Americans return to the workforce, we need to increase access to these jobs. We have called on the Department of Transportation to expand eligibility for commercial truck drivers, extend hours of service and increase shipping weights. Of course, agriculture is no stranger to worker shortages, and if we’re going to ensure the stability of our nation’s food supply in the long-term, we must reform our H-2A program in a way that works for all of agriculture.

We must ensure that farms can continue producing food, fiber and fuel sustainably and that those products can make it out the farm gate to processing facilities to stores and to consumers. As I mentioned at the top of this column, the problems facing our supply chain will take time to address fully. But work is underway, and at Farm Bureau, we’ll keep coming to the table with ideas and solutions to clear the hurdles. Rest assured, every day you are out there still farming, the American Farm Bureau has your back.

---

Source: American Farm Bureau Federation

---