Prices create ‘golden time’ for local farmers

By Melissa Silverberg

Grain prices have reached record highs in recent months, creating increased profits for local farmers in spite of higher food prices worldwide.

“There is a good deal of money flowing out of the stock market that is coming into commodities like grains,” said Steve Ayers, a farm business educator with the University Extension program. “We are seeing unprecedented demand.”

The increased grain prices have provided more cash flow for local farmers and allowed them to reinvest in their own farms, Ayers said.

Diann Moore and her husband, Jim, own the Moore Family Farm in Watseka, Ill., which produces grains, flours and many other pesticide-free products.

“Prices have been going through the ceiling,” Mrs. Moore said.

Global food prices have continued to rise with the increase in fuel prices and the current economic situation. Although farmers may be making more money, the costs of production have still increased, Moore said.

Karen Linder and her family own The Linder Family Farm in Onarga, Ill., which has also received benefits from the recently increased grain prices.

When farmers are making more money, the equipment manufacturers and other producers also raise their prices, Linder said.

“We have seen increased prices, but with that we’ve also seen increased costs,” she said. “It really balances out.”

Some farmers may be able to use the influx of cash to buy new equipment for their farms, Ayers said.

“It’s given us the flexibility to start looking at buying something new,” Linder said. “But we aren’t going to throw out everything we have and buy all new equipment.”

While these higher prices are good for grain farmers, they are harmful to the people who need to buy the food, Mrs. Moore said.

Common Ground Food Co-Op sells many locally produced and organic products provided by local farmers.

If prices continue to go up, it will affect the consumer who will have to buy these products, said Jacqueline Hannah, Common Ground owner.

There has not yet been an increase in the cost of goods, Hannah said, but it is a possibility in the future as the cost of all food and goods rise.

“In the end, the person most deeply impacted is the consumer,” Hannah said.

Food prices at the Co-Op have not yet increased, but the Moore Family farm has raised their prices to compensate for rising costs.

Prices have gone up minimally, Mrs. Moore said, explaining that the increase is really only to cover costs and that the farm is not making much of a higher profit than this time last year.

Moore added that she is not worried about increased prices harming sales, however, because of the loyal following she said the farm has during both the offseason and later in the year when the Urbana Farmers’ Market re-opens.

Although times may be great for farmers right now, they are operating in an economy that, according to officials, is bordering on the brink of a recession. Many local farmers are growing crops or raising animals that will not be on the market for up to three years, when the state of the economy could be entirely different, Mrs. Moore said.

“The economy is affecting what we do,” Mrs. Moore said. “People don’t have money right now, and we are hedging on a future that is so unknown.”

The prices are not likely to stay this high forever. In fact, Ayers said they will go down faster than they came up. When prices do fall, farmers may have less extra cash flow, but prices may return to normal for consumers looking to buy food, he said.

“It’s really just a golden time for agriculture,” Ayers added.