If the plans of a group of investors called Great Lakes Basin Transportation get the go-ahead, the Midwest could soon be home to the nation’s largest new railroad project in more than a century.
The idea behind this proposed 278-mile rail line is to allow some freight traffic to bypass the Chicago rail yards, where congestion caused by the greatest density of rail lines in the world can tie up freight for 30 hours. Current projections show traffic in this rail hub only growing and congestion worsening in the years ahead.
Farmers in the states and provinces that make up CSG Midwest’s Midwestern Legislative Conference are the most prolific producers of edible protein in the world. This is an enviable position to be in, especially at a time when demand for high-protein diets is on the rise, and a new binational partnership is seeking to make the most of this regional economic advantage. Developed by the Consulate General of Canada in Minneapolis, the “Protein Highway” initiative encompasses three Canadian provinces (Alberta, Manitoba and Saskatchewan) and six U.S. states (Iowa, Minnesota, Montana, Nebraska, North Dakota and South Dakota).
For North Dakota Sen. Terry Wanzek, recently passed legislation in his state to provide exemptions to a ban on corporate hog and dairy farming is all about the preservation of the family farm — including his own.
“My cousin owns a dairy farm next door to our crop farm,” explains Wanzek, who sponsored SB 2351 last year. “He is investing heavily in updated facilities, but if we wanted to incorporate together to add value to my crops, any corporation would be illegal should our children inherit it, because they are not closely enough related.”
SB 2351, passed by the North Dakota Legislative Assembly, would provide the necessary exemptions. Specifically, it would allow corporations to own up to 640 acres for a dairy or hog farm; corporate ownership of any other type of farming operation, or of farmland, would remain illegal in North Dakota.
“We have to provide ways for family farms to grow and continue to the next generation,” Wanzek says.
But opponents of the legislation (including the North Dakota Farmers Union) say SB 2351 is not the answer, and they gathered enough signatures to force a statewide vote on it in June. A “no” vote would mean that corporate dairy and hog farms owned by individuals further apart than three degrees of kinship would remain illegal.
Ask Minnesota Sen. Matt Schmit what his rural communities in Greater Minnesota need to prosper, and it doesn’t take long before the discussion turns to the importance of having high-speed Internet. “A good share of our rural homes and businesses still lack access to Minnesota’s very modest speed goals,” he says.
Schmit is not the only state lawmaker concerned about this lack of connectivity. Six years ago, the Legislature passed a bill calling for all Minnesotans to have access to those “modest speed goals” (10 megabits per second download and 5 Mbps upload) by 2015. As of last year, however, only 78 percent of households met that standard.
America’s farmers are aging, fast. According to the 2012 U.S. Department of Agriculture census, the average age is now 58, up from 50 in 1982 and now nearing the average retirement age in this country (it is 62, a recent Gallup poll found). But there might be a younger group that could at least be part of the nation’s next generation of farmers — military veterans, particularly those seeking new career opportunities as they return from service overseas.
Even without a new Trans-Pacific Partnership, U.S. agriculture producers have deep ties to the 11 other countries involved in the potentially historic new trade deal.
About 45 percent of the nation’s farm exports already have these nations as their destination, and as the U.S. Congress decides whether to approve the TPP, one of the deciding factors could be this: Will this deal open up key foreign markets even further, for the benefit of the nation’s farmers and ranchers?
How will falling commodity prices impact the Midwest? All of the region’s major commodity crops — corn, wheat and soybeans — are going to be priced right around the cost of production for the next year, North Dakota State University agriculture economist Frayne Olson told lawmakers this summer at the Midwestern Legislative Conference Annual Meeting. And for the first time in many years, farmers will be losing money on their crops. The U.S. Department of Agriculture has predicted that net farm income will be down 36 percent from 2014 and reach its lowest level since 2002.
The causes of this hit to the farm economy range from a slowing global economy and a stronger U.S. dollar, to higher grain reserves and the weather. But what will be the broader effects of this fall in commodity prices on the region’s states?
The biggest impact will likely be felt in North Dakota, South Dakota, Iowa and Nebraska, states where farm income provides more than 18 percent of gross domestic product and where one in four jobs are tied in some way to agriculture.
Through the summer of 2014, the news about rural employment was not good. While the U.S. economy as a whole was recovering from the recession, the number of people employed in rural areas remained weak, lagging more than 3 percent behind totals for 2007. And between the second quarters of 2010 and 2014, rural employment had grown only by 1.1 percent (compared to 5 percent in urban areas).
Though the number of people unemployed in rural areas was decreasing, that was due in part to factors such as outmigration and aging populations. Actual jobs had declined or stayed the same in the majority of non-metropolitan counties from 2000 through most of 2014.
But there has been a turnaround of late, especially in many of the Midwest’s rural counties. Over the past year, the rate of job gains in rural America, 1.2 percent, has come close to meeting those in urban counties, 1.8 percent.
In his home legislative district, Ohio Sen. Cliff Hite knows well the dilemma facing local agricultural producers: Their tax bills are skyrocketing (by an average of 62 percent this year), he says, while returns are declining and operational costs are rising.
But finding a legislative fix to the problem is much easier said than done.
“Discussion on use value could backfire on farmers,” says Hite, noting that Ohio, like most states, has “an increasingly urban electorate and legislature not understanding why farmers should get a tax reduction.”
In Ohio, and most other Midwestern states, farmland is appraised using a formula based on “current agricultural use value.” Based on factors such as commodity prices, soil productivity, rental rates, production expenses and interest rates, the state determines the income that a farmer can be expected to earn on his or her land.
A highly contagious strain of “bird flu” hit the United States this year, and parts of the Midwest have been the epicenter of the outbreak. As of early May, highly pathogenic avian influenza, H5N2, had been identified in 17 states, with outbreaks at more than 60 farms in Minnesota alone and the loss of more than 28 million birds. Bird flu has also been reported on farms in Iowa, Kansas, North Dakota, South Dakota, Wisconsin and Ontario.