One in three or more farms in Arkansas could be shuttered by next spring if the federal government doesn’t provide some type of supplemental assistance to farmers this fall, Agriculture Council of Arkansas President Joe Mencer told Talk Business & Politics.
Commodity prices continue to plunge and as of mid-August the state’s ag sector was projected to lose $1.145 billion this season and that numbere has ballooned by another $300 million by the end of the month to $1.4 billion as rice prices spiraled downward to an eight-year low.
And, the overall losses will almost certainly continue to rise, Mencer said.
The Ag Council has submitted two letters, one to the White House and the other to the U.S. Trade Representative, seeking relief in a number of areas, Ag Council Executive Director Andrew Grobmyer told TB&P. The federal government has reported a record $100 billion in tariff collections, and many in the farm sector would like some of that money used to supplement farmers, he said.
“First of all, we’re in dire straits,” Mencer said. “Ag is in turmoil right now.”
Mencer and Grobmyer will head to Washington D.C. next week to personally relay their concerns to members of the Arkansas congressional delegation, representatives from the White House, and the U.S. Trade Representative.
The tumult in the ag industry will impact many other ancillary businesses too. Ag equipment dealers, parts dealers, crop dusting companies, and many others have had sales plunge as much as 50% this year, Mencer said. Banks are reporting that as much as 25% of current farmers won’t be able to get financed for next year as of right now and that number will continue to balloon, he added.
Many rural banks that rely on the ag sector may be shuttered as well if relief isn’t distributed, he said.
Some actions taken by lawmakers have helped the farm community during this downward spiral that began three years ago, Grobmyer said. The Emergency Commodity Assistance Program saved some farmers up to 25% of their projected losses. The recently passed federal budget, dubbed the “One, Big Beautiful Bill” has provisions that raise reference prices.
But, it won’t take effect until the 2026 harvest season, and many farmers in Arkansas won’t be in business next year if something isn’t done, Grobmyer said.
The ongoing shuffle of the global trade markets has disproportionately impacted farmers, and that’s why the organization is seeking measures that will funnel tariff dollars into a farmer supplemental program, Grobmyer said. Even if trade negotiations are finalized soon, it won’t be in time to help farmers with this year’s crop, Mencer added.
Other measures they may seek are incentives to broaden the renewable fuels markets. They also support sourcing the Buy American Cotton Act and the Grown in America Act.
Another looming problem for farmers is storage, Mencer said. Commodity prices were so low last year that many farmers kept grains in storage rather than selling them at a loss, he said. Now, the new crop is coming in and there is no place to store it.
“I think you’re going to see a lot of grain piled up on the ground. I’ve never seen anything like this,” he said.
The Ag Council sent a letter to the U.S. Trade Representative to address the ongoing issues with Brazil. That country is slashing and burning its rain forests to create ag land and it sells most of its commodities to China. The Chinese are investing heavily in infrastructure in the country, building railroads, roads and ports to transport these commodities.
American farmers have to pay tech fees, meet emissions standards, and pay much higher labor costs, Mencer said. This means that Brazilian farmers can produce soybeans at a much lower cost and can sell them at a lower cost putting U.S. farmers at a disadvantage, he said.
About 70% of commodities grown in Brazil go to China. This allows the Chinese to coerce farmers there to buy equipment and products from Chinese vendors, Grobmyer added.
More than 20 years ago, Mencer went to Brazil, and they were not using modern equipment, seeds or farming techniques. That has all changed, he said.
“Brazil is a key source of pain for American farmers,” Grobmyer said.
Arkansas does have some political strength when it comes to pursuing these programs to “bridge” the gap between this harvest and next year. Each of the state’s congressional members has a chairmanship or key leadership role in committees with direct or indirect ties to the ag industry.
Gov. Sarah Sanders was given copies of the letters sent, and in recent months she has been traveling the state to host a series of ag roundtable talks with farmers and other stakeholders.
Grobmyer said he hopes this political clout will produce results soon. If not, the outlook for the farm community is bleak, he said.
“There is a true disaster looming on the horizon,” he said.