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Northey: Farming still key in state’s economy

By Staff | Jan 8, 2010

“Iowa agriculture grew larger than the state’s budget.” —Bill Northey Iowa Secretary of Agriculture

Iowa Secretary of Agriculture Bill Northey Monday rattled off his accustomed litany of ag statistics at a meeting with the Noon Rotary Club in Fort Dodge. He offered club members a fresh glimpse into the importance of farming in Iowa’s economy.

“Iowa is the second leading state in total ag sales,” Northey told the room of about 40 listeners. He said that Iowa’s farmers represent a $20 billion-plus industry and added that the industry’s revenue grew by $8 billion from the 2002 census to 2007. He compared that to the state’s current general fund budget of $6 billion.

“Iowa agriculture grew larger than the state’s budget,” Northey said.

When asked what Northey hopes that a non-farming audience will take away from his talks, Dustin Vande Hoef, Northey’s communications director, said a renewed awareness for businesses owners and community leaders that agriculture is still an integral part of the state’s overall economy.

“In smaller communities like this one,” Vande Hoef said, “people know that farming is important.” However, Northey enjoys talking to non-ag groups to help keep the knowledge fresh, Vande Hoef said.

To add emphasis to his number, Northey noted that 5 percent of the state’s corn remains standing, much of it in western counties, which represents roughly $470 million of revenue at risk to winter elements. The income level is based on 2007 census values.

Although many Iowans know that Iowa leads the nation in corn, soybeans and hog production, Northey said, “many people aren’t aware that we are first in egg production.”

He said that Iowa has 67 million layers with a total egg production value exceeding $400 million. He said one north central Iowa producer supplies the daily need for eggs to the entire McDonald’s chain west of the Mississippi River for both fresh and processed eggs.

“All of our eggs and hogs go someplace,” Northey told the Rotary club, “someone is dependent on them.”

Exports are also essential for Iowa farm income, the ag secretary said. China, for instance, is the top importer of Iowa soybeans, “which is why we are still getting over $10 for soybeans,” he said. At the same moment, soybean futures for March were at $10.58.

He said swine flu put a crimp on pork importers in Japan, but added that those restrictions were more for protecting that country’s growing swine production industry.

He said that as a result of the U.S. slapping duties on Chinese tires last fall, the possibility of extra tariff charges on Chinese steel, he expects there will be “some push back” from the Chinese on Iowa ag products.

IDALS services

Northey switched gears and talked about the various facets of the Department of Agriculture and Land Stewardship and the services provided for Iowans in general, such as weights and measures, headed by Jill Paxton, bureau chief, which assures that Iowans get a full gallon of gas at the pump.

Northey said that IDALS is also home to:

o State Entomologist Robin Pruisner who, among other duties, watches the onset of the ash borer, not yet found in Iowa, but devastating ash trees in eastern states; and watching for soybean rust as it encroaches from the south.

o State Climatologist Harry Hillaker who watches weather patterns and keeps Iowa’s weather records.

o State Veterinarian David Schmitt who is tasked with protecting the animal agriculture industry from foreign animal disease introductions and maintaining a state of emergency preparedness sufficient to deal with disease and natural disaster concern.

o Horse and Dog Breeding Bureau, which primarily serves Iowa’s horse- and dog-racing industries.

Iowa farming concerns

Northey addressed several issues that have Iowa farmers concerned including cap and trade legislation, moving Plum Island Animal Disease Center to the Midwest, the failure of the U.S. Congress to renew the biodiesel tax credit and if Iowa will eventually grow sunflowers for the biodiesel industry.

Concerning cap and trade, Northey said Iowa farmers are concerned because farming is an energy-intensive industry.

“Are we smart enough to know what to tax?” Northey asked. “In farming I don’t think we know those levels yet.” He estimated that as a result of cap and trade, Iowa could see 59 million tillable acres revert to forested land.

“That has livestock producers concerned,” he said. “We’d lose pastureland, but also corn acres.” That loss of corn would push grain prices, and therefore feed prices, further up.”

Northey declined to offer an opinion on the wisdom of moving the animal disease center from Plum Island on the East Coast to the campus of Kansas State University. He said although it would be better to have the facility closer when Iowa transports unknown or suspected pathogens to another Midwest state, the fact that other states would be transporting their suspected pathogens through the Midwest, where livestock is concentrated, is unsettling, he said.

The ag secretary also thinks Congress will reinstate the biodiesel tax credit, which expired on Dec. 31. He said a House version has already been approved and is waiting for the Senate to act. He was uncertain, however, if the credits will be retroactive to Jan. 1. Since the biodiesel blending industry cannot function without the credit, then blenders would likely to stop working.

When asked about Iowa planting more sunflowers for the biodiesel purposes, Northey smiled and said, “the problem with our ‘third’ crops is that we do such a good job growing corn and soybeans, that it’s difficult to find a third crop that would match the production.”

Northey, who is completing his first four-year term this year, was invited to speak to the club by member Clyde Knupp, of Fort Dodge, who chairs the club’s foundation and is a club past president.

Knupp said he grew up on a farm, but does not actively farm now. “I think (Northey) does a great job in the position,” Knupp said. I’m always surprised at how much goes through that office.”

Contact Larry Kershner at 515-573-2141, ext. 453, or by e-mail at kersh@farm-news.com.

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