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Small Farms Hit Hard In 2019

STEVE INSKEEP, HOST:

The farming economy had a terrible 2019. Many small farmers face rising debts and gut-wrenching decisions of whether to close businesses they've owned for generations. Stacey Vanek Smith reports for NPR's The Indicator from Planet Money.

STACEY VANEK SMITH, BYLINE: 2019 was a hard year for farmers. Small farms have been hit incredibly hard by a combination of the trade war with China, extreme weather and an increasingly competitive and global industry. The government has stepped in with subsidies for some farmers. But in spite of that, the debt level of American farmers is at an all-time high, and the number of farmers who are delinquent on their loans is on the rise. Alana Semuels is an economics correspondent for Time magazine. She wrote a story recently about what's happening to the rural economy and to farming right now.

ALANA SEMUELS: Think about the 2000s. People tell me that was kind of the golden age of modern farming in that commodity prices were going up. It was kind of this boom time. And then in 2013, they basically ended. Commodity prices went down. Two big reasons - one, farms are getting a lot more efficient every year. You can produce a lot more on the same land, and a lot more farms entered the kind of global marketplace.

VANEK SMITH: Yeah. I mean - and you talk about the debt level for farmers.

SEMUELS: Yeah. So right now, it's at an all-time high, which - I think it's at $416 billion. It was up really high in the '80s. A lot of people lost their farms. We're not seeing prices go up. So how are they going to pay that debt off?

VANEK SMITH: In her story, Alana visited a particularly hard-hit area in Wisconsin, a town called Fremont, where she met with the Rieckmann family. I called Mary Rieckmann to ask her about her farm.

MARY RIECKMANN: We have a small dairy farm. My husband is a fourth generation on this farm. I've been on here 60 years.

VANEK SMITH: I imagine you've seen all kinds of cycles. The price of milk goes up and down.

RIECKMANN: Oh, yeah.

VANEK SMITH: What's the price right now?

RIECKMANN: Right now, it's 18 something for 100 pounds of milk.

VANEK SMITH: Enough to make a profit?

RIECKMANN: No - maybe for the great big farmers but not for the small farmers. And, you know, it keeps on adding up and adding up, and it's just like, oh, my gosh.

VANEK SMITH: Is part of this, like, some of the trade war stuff or no?

RIECKMANN: Yes, it is. And other countries used to buy.

VANEK SMITH: So now they're not buying it.

RIECKMANN: No, they're not.

VANEK SMITH: So prices have gone...

RIECKMANN: Down the tubes (laughter). We're just going to keep on struggling and struggling until there is nothing left to struggle for anymore because this is our home.

VANEK SMITH: How do you kind of get through moments like this?

RIECKMANN: Well, you skimp and you scrape wherever you can make a penny mean a little bit. I mean, we don't do Christmas gifts or anything for the last three years. What we do on Christmas Eve is we all get together as a family, just visit and have a lunch together. Yeah, well, that's as much as what we can do.

VANEK SMITH: Time magazine's Alana Semuels says the decline of small farms like the Rieckmann's is killing rural communities as businesses close and tax revenues decline. And Alana says, perhaps more seriously, the lack of diversity in production could also threaten our food supply. Stacey Vanek Smith, NPR News.

(SOUNDBITE OF WHALE FALL'S "THE APARTMENT") Transcript provided by NPR, Copyright NPR.