Farmers on the brink
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We begin with the price of fertilizer, which has been soaring to record highs across the globe. Key sources of nitrogen, potassium, and phosphorous – important inputs into soil fertility, crop yield, and plant maintenance – have all gone vertical. Ammonia is derived directly from natural gas, and the price of natural gas outside of the US has gone vertical. It's no surprise that the price of ammonia has tripled over the past twelve months. Belarus is the third-largest supplier of potash in the world and its state-owned miner, Belaruskali, declared force majeure after sanctions were imposed by the US and Europe. The number two supplier of potash globally? Russia. Perhaps front-running the Russian move on Ukraine, China halted phosphate exports last fallin an effort to ensure adequate domestic supply.
And fuel:
Diesel is another significant input into farming, and it too is facing a global supply crunch. Javier Blas, an energy and commodities columnist at Bloomberg whose Twitter account is an absolute must-follow, recently published an editorial sounding the alarm:
“The dire diesel supply situation predates the Russian invasion of Ukraine. While global oil demand hasn’t yet reached its pre-pandemic level, global diesel consumption surged to a fresh all-time high in the fourth quarter of 2021. The boom reflects the lopsided Covid economic recovery, with transportation demand spiking to ease supply-chain messes.
European refineries have struggled to match this revival in demand. One key reason is pricey natural gas. Refineries use gas to produce hydrogen, which they then use to remove sulphur from diesel. The spike in gas prices in late 2021 made that process prohibitively expensive, cutting diesel output.”
And Chips and Spare Parts
As expensive as it is to fuel the field equipment needed to farm, keeping them operational at all is becoming an ever-growing challenge. The same chip shortage constraining automobile production has struck the farming equipment industry, making new equipment and spare parts harder to come by. Farmers in Iowa recently vented their frustration at a Republican forum on agriculture:
“…they bemoaned the hit-and-miss availability of parts to fix their equipment — the result of pandemic disruptions in the production of those parts. Iowa Rep. Ross Paustian, R-Walcott, is a farmer who said his neighbor was forced to buy a hydraulic pump for his tractor from a Nebraska dealership because it was the only place in the country that had it stocked.
Jim Boyer, an Emmet County farmer, had a similar, personal anecdote. He’s awaiting a $40 emissions-related sensor for his tractor, and he’s not sure if it will arrive anytime soon.
‘I cannot drive that tractor — a quarter-million-dollar piece of equipment — because I cannot get that sensor,’ he said.”
And a Labor Shortage
Compounding these challenges with machinery is a burgeoning labor shortage that is rapidly adding pressure to this brewing catastrophe. Although the labor issues in the US span well beyond agriculture, there are aspects that exacerbate the impact on farmers, including the physical labor intensity and seasonality of many roles, as well as the reliance on foreign laborers to fill key positions US citizens have historically shunned. This is especially challenging in light of vaccine mandates at border crossings. Here’s a recent report from Wisconsin Public Radio which describes the challenges well:
“While some farms employ workers all year round, Strader said many jobs are seasonal, starting in March and April and going until late fall when harvest ends.
With producers on edge about hiring for this year, Strader said many farms started recruiting earlier than usual and developed a contingency plan for how to make it through the season without employees. That could mean discontinuing certain markets or scaling back the variety of produce that they’re growing.”
And Don’t Forget Propane
Even generously assuming farmers can cobble together enough fertilizer, herbicide, machinery, and labor to produce a good harvest this fall, they may be left to deal with yet another crisis of supply that few off the field have on their radar: propane.
What does propane supply have to do with farming? Grain drying. Here’s a primer on the importance of drying, from Wikipedia:
“Hundreds of millions of tonnes of wheat, corn, soybean, rice and other grains as sorghum, sunflower seeds, rapeseed/canola, barley, oats, etc., are dried in grain dryers. In the main agricultural countries, drying comprises the reduction of moisture from about 17-30% w/w to values between 8 and 15% w/w, depending on the grain. The final moisture content for drying must be adequate for storage.”
Many farms are located in rural areas without ready access to natural gas, and thus some 80% of grain dryers in the US, for example, rely on propane as a fuel. In a piece we wrote in December called An Urgent Call on Line 5, we chronicled how progressive politicians and environmental groups were targeting an important pipeline artery that runs from Canada, under the Straits of Mackinac, and across the State of Michigan. Line 5 is crucial to the stability of the US supply of propane, and yet – despite the catastrophic energy crisis we find ourselves in – the Attorney General of Michigan was recently captured on video spouting unserious nonsense ….
And so on; lot’s more at the link, and yet nothing that hasn’t been warned about for years as the environmentalists and socialists have worked to return the world to a depopulated, impoverished state governed by the enlightened few (remember Prince Phillip’s “quip” back in 1988, that he’d ike to be reincarnated as a deadly virus “to help out on the overpopulation problem — he wasn’t kidding, nor was he alone in his sentiments).
The Mormons advise their people to keep a year’s supply of food available in the event of disaster. I myself have a couple of boxes of spaghetti and cans of beans in my pantry, but that’s about it. I’ll be really tired off if, after the apocalypse, Mitt Romney is the last man standing.
