MILO, Iowa — For Craig Hill, president of the Iowa Farm Bureau and a grain and livestock farmer near Milo in Warren County, the biggest U.S. agriculture story of 2013 is a number — four — as in $4 corn and the lower crop prices that arrived at the end of the year.

“That is kind of the story of the year 2013,” he said.

Hill said the lower crop prices, which were a result of several factors, including a larger-than-expected 2013 crop in corn and soybeans, may signal the end of one cycle and the start of another.

“I think it’s the year when we changed from a very prosperous time, a bubble, to a time when we are going to have some very stiff constraints on our margins due to oversupply,” he said.

Hill started farming on his family’s farm southeast of Des Moines in 1977, three years before the farm crisis of the 1980s hit head-on, but he sees few comparisons.

“It’s quite different. We didn’t take on the debt that we did in the 1970s. Our balance sheets are looking a lot stronger,” he said.

He said farmers today also don’t have the double challenges of the Soviet grain embargo enacted by President Jimmy Carter nor the inflation-fighting measures enacted by President Ronald Reagan.

“Government swings a big club and we were hit with it. I don’t see that playing out in the next few years,” he said.

Ag Voices

Members of the agriculture industry who are involved in everything from state farm organizations to state leadership and agribusiness associations talked to AgriNews about some of the top farm stories of 2013, including the drop in crop prices, the farm bill, the Renewable Fuel Standard, the weather and regulatory and government policy issues.

For Cress Hizer, CEO of the Agribusiness Council of Indiana, the unexpectedly bountiful corn and soybean crops of 2013, was a good-news, bad-news story.

“I think it’s a tribute to how good farmers are in producing crops despite challenges. I think it’s also a tribute to these modern corn varieties, the genetics, the biotech, that we produced a top five corn crop,” he said.

The consequence of that corn crop and an equally fine soybean crop means a more careful approach to budgeting.

“I think what it leads to is pencil-sharpening by growers, how to cut some costs. Below $5 corn is causing quite a bit of scratching of heads saying, ‘OK, where’s this going to lead us?’ Coupled with the uncertainty in the ethanol marketplace, it is going to cause, I think, a little bit of retracing of steps and looking at what our break-even points are,” Hizer said.

The U.S. Environmental Protection Agency announced its proposed 2014 renewable fuels goals in mid-November. That proposal included a lower amount of biofuels than expected.

“The Renewable Fuel Standard is a big concern. I think knee-jerk political actions don’t have a very good track record,” Hill said.

Iowa was in the spotlight just days before the EPA’s announcement after a story by the Associated Press, datelined in Iowa, drew headlines of its own — and the ire of the U.S. ag community — with its damning portrayal of conservation lands being cleared for corn production for ethanol.

“The RFS announcement came out as a leak. It wasn’t a formal release. It was a leak initially, so you had some reservation, some pause, and it turned out to be true,” Hill said.

He said members of his organization and others already are responding during the EPA’s 60-day comment period, which continues through Jan. 28.

“Farmers and citizens are going to respond to that. We deserve a diversified fuel portfolio in America,” he said.

Hill said the AP story was written with one intention.

“You can spin anything however you like. It was written to demonize and villainize those who are involved in agriculture,” he said.

Ethanol Shocker

Bill Northey, Iowa secretary of agriculture, said the RFS announcement came as a shock to him, as well.

“I really hadn’t been expecting that. I was surprised, and I guess I was surprised because, in general, the administration has been supportive of renewable fuels through some fairly challenging times the last few years with high grain prices,” he said.

Northey said the fact that the reduction in the proposed amounts of renewable fuels to be used in 2014 especially were surprising in the face of a large crop and lower grain prices.

“The case could be made more then than now for that kind of adjustment, and they didn’t make it then, so I was surprised that they did it now,” he said.

At its annual meeting in December, Illinois Farm Bureau had some 900 members sign a petition opposing the proposed RFS levels.

“What I’ve been saying is this is a good time for you to reflect on how important that policy is to you and how important it is to see the impact in the years to come,” said Adam Nielsen, director of national legislation and policy development for the Illinois Farm Bureau.

“I think we’re being tested with the EPA’s proposed rule, and we’re going to have to respond. We’re doing everything we can, and we’re going to be encouraging members to host events at ethanol plants to remind people how important renewable fuels have been to agriculture and the related industries,” he said.

Nielsen said the proposed cuts in the RFS aren’t the only policy issue attached to the national debate on renewable fuels.

“It’s an interesting period. If it’s not coming at us from a regulatory standpoint, there are a number of bills that would repeal the RFS or make dramatic changes, so those conversations are occurring while we are fighting the proposed rule. It’s an interesting time for us and we have to respond to the challenge,” he said.

Hizer said that with Indiana’s closer proximity to eastern fuel markets and with its plants being newer, he believes ethanol will continue to be a major player in Indiana’s agriculture industry.

“I think from Indiana’s viewpoint, ethanol is going to continue to be a strong partner in these markets. Our plants are closer to the East Coast markets, and we’re in great shape with our infrastructure and access to those markets,” he said.

Regulation Concerns

Hizer said the issue with the drastic cut in the RFS points to another major issue that remained front and center for U.S. farmers in 2013 — government regulation.

“I think it does give us a little glimpse at this whole discussion of is ag being overregulated,” he said.

Jean Payne, president of the Illinois Fertilizer and Chemical Association, said the April explosion at the West Fertilizer Co. in West, Texas, was the top story for the year.

The fire and explosion claimed 14 lives, injured more than 150 and leveled more than 60 structures, including a number of homes. Authorities attributed the explosion to a large amount of ammonium nitrate fertilizer stored at the company.

“I think No. 1 for our customers, the retailers, was the executive order issued by the White House in August 2013 after the explosion in West, Texas,” Payne said.

She said the order requires OSHA, the Department of Homeland Security and the U.S. EPA to reevaluate existing regulations on chemical and chemical storage facilities.

“We’re already seeing the federal agencies respond to that order,” she said.

Payne said the response is coming in the form of more audits of facilities and more random visits.

“We’re concerned about what that will lead to — we’re concerned about yet more regulations impacting our industry. I think it’s the nature of the beast that anytime there is a tragedy, the reaction is typically let’s do more to regulate these facilities,” she said.

Nielsen said he worries that the remaining months of a lame-duck president’s term could bring more proposed regulations.

“In the last two years of a president’s term, the amount of regulations that end up in the Federal Register go up astronomically, and we expect this to happen in the final years of the Obama administration. They could involve all kinds of issues that would have an impact — water quality, nutrient standards, the EPA’s ‘waters of the U.S.’ changed to encompass land-use decisions. We’re going to be paying very close attention to those. I think the regulatory agenda will be pretty substantial,” he said.

Hizer said he expects to see more discussion on regulations. He said the rulemaking process is lengthy, and while regulations may be proposed, that process means that not all will become law.

“I’m experienced in rulemaking, and we can see these proposals for a while, but the rulemaking process is a very long gauntlet. I think you’ll see a lot of debate. I predict some kind of compromise on things like the RFS. I think with issues like regulating dust, we’ll talk about those things, but the rulemaking process is a very long and open process,” he said.

Farm Bill Inaction

Same time, next year.

Nobody thought, when December 2013 headlines threatened the “dairy cliff” if a farm bill or extension wasn’t passed by midnight on Dec. 31, 2012, that the same time, a year later, lawmakers still would not have a new farm bill.

When Payne accompanied some of her members on a trip to Washington, D.C., in March, the attitude surprised her.

“When we asked our members of Congress what was going on with the farm bill, we overwhelmingly got — well, that there was a kind of apathy about it. The reason they felt things really hadn’t moved was they weren’t really hearing that much from farmers about the need to get a farm bill done,” she said.

Activity picked up on the farm bill, but after the Senate twice passed a version of a new farm bill, the U.S. House first failed to bring a House Ag Committee version to the floor, then passed a bill that split the nutrition titles from the rest of the bill.

Shortly before leaving for their holiday break, both chambers passed a one-month extension and indicated an agreement was close.

“The presumption is it’s going to happen soon. I think all of us are concerned about whether it really is,” Northey said.

He said his frustration with the process stems from the same apathy mentioned by Payne.

“It would seem like the difference could be figured out if you have the will to do it. To me, that was a demonstration of the lack of a will to do it. It did appear at some times that at least some people were not trying very hard to get it done,” he said.

For Hizer, the farm bill activity over the summer presented a different sort of dilemma.

“Obviously, what makes it interesting for Indiana farmers is the fact that the historical coalition that farmers have always had via the farm bill has been with urban folks on the nutrition title. Interestingly enough, that break was led by a young congressman who is a well-respected Indiana farmer, Marlin Stutzman,” he said.

Hizer said the action by Stutzman, who first floated the proposal to separate the nutrition titles from the rest of the farm bill, came as a surprise.

“We all supported Marlin. He’d done a great job in the state Legislature for agriculture. He’s the only true farmer we have, and decoupling that historical partnership caused some concern. I know Farm Bureau and some other groups weren’t sure how to really respond,” he said.

Hizer said the move to decouple the farm bill jeopardized the link between food and farm in the farm bill.

“Farming is all about food, and it just caused a lot of concern about what’s going to happen with the historical coalition of how to get farm legislation passed by using our dining-room table,” he said.

“I would say 2013 was a roller-coaster year for the farm bill, lots of twists and turns,” Nielsen said.

He said the debate over the farm bill points to other issues of concern for agriculture on the national policy stage.

“It’s not surprising given the character of the candidates that have been elected to Congress in the last four years. It’s increasingly conservative and fiscally conservative, suspicious of any legislation that smacks of a comprehensive-type of bill. It was not a surprise given the changing demographics and makeup of Congress. These are individuals who were elected to say no,” he said.

Nielsen said the outlook is positive for a new farm bill to pass once Congress goes back to work in January.

“I think most of the job is done,” he said.

Nielsen said he believes the compromise over cuts to the nutrition programs would be acceptable to both parties and that the outlook for crop insurance also is positive.

“It sounds like conservation compliance will be linked to crop insurance. We’re hoping there will be no means testing for crop insurance, but we won’t know until we see the details. Despite attempts to radically change the program, it appears we are going to come out on the other end in very good shape,” he said.

Weather Woes

If there was an ongoing story in agriculture for 2013, it was what mood is Mother Nature in this week.

Spring planting across the Corn Belt was delayed for weeks, in some areas in Iowa until mid-June, as rains kept fields flooded and muddy. After farmers managed to get in their fields, the new crop was further handicapped by a severe drought in midsummer.

“In Iowa, we broke records in May and June for rain. It really limited our ability to raise a big crop this year — over a million acres in Iowa was prevented from being planted. Then it quit raining. Between the heat and the drought, we really were afraid we were losing our crop in Iowa and parts of Minnesota. Lo and behold, whether it’s genetics or management practices, we came through with a pretty decent yield, a better yield than we ever expected,” Hill said.