Rice balance sheets are on the brink, according to Texas A&M’s Agriculture and Food Policy Center.
Pressure’s on: Rice’s infrastructure and market go against the grain from other commodities. Input prices have climbed across the board, but rice hasn’t seen corresponding gains in commodity price.
Out of 15 representative rice farms, only five will cash flow under current conditions, according to Texas A&M. The rice industry is at risk of losing producers at a pace never seen before.
Budget busted: It could cost growers up to $1,000 to fuel up their tractors. Increasing fertilizer prices are taking their toll, but farmers can’t pass those inflated costs down.
Soundbite: “The mills actually set the price. The world market sets the price on us, and that’s a whole different ball game,” said Southeast Texas farmer Casey Dishman.
Where this goes: Dr. Joe Outlaw—co-director of A&M’s Ag & Food Policy Center, professor, and extension economist—has proposed Congress use adjusted formulas from the Coronavirus Food Assistance Program to support rice producers. He also suggested indexing the Price Loss Coverage reference price to cost of production.
USA Rice is involved in conversations with the government to secure near-term financial support for farmers.