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Feeling the pinch


Farmers, consumers digging deeper to bring food to the family table


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Area farmer spreads fertilizer across field. Increased demand has prompted a spike in farm supply costs. photo by Maria Brown.

May 21, 2008
TRI-CITY AREA — Whether it's five pounds of flour or a bushel of fertilizer, a combination of all the right factors are driving up food and production prices for both the consumer and farmer this spring.

Retail food prices for 16 basic grocery items were up nine percent in the first quarter of 2008 compared to a year ago, an American Farm Bureau survey showed.

Flour, cheddar cheese, corn oil and a dozen eggs all saw their price tags jump more than 50 cents in a few months' time.

Farmers will feel it in their pocketbooks when they purchase diesel fuel (up 120 percent in the last five years), fertilizer (up 90 percent) and machinery repairs due to steel costs (up 50-70 percent).

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As for the spring planting season, Lapeer County Michigan State University Extension Director Phil Kaatz said fertilizer is foremost on most farmers' minds.

"Not only are prices high at this time, there is some rationing for some of the consistently used types like potash," Kaatz said.

Steve Jarvis, fertilizer manager at Lapeer Grain, said they've been under fertilizer allocations in past years, but 2008 is proving to be "a little worse."

"It all depends on (the farmer's) time and perspective," Jarvis said of the shortages.

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Residents struggle to pay skyrocketing food costs.
Shipments continue to arrive but the supply in their warehouses vary "day by day," he said.

He too confirmed potash, a source of potassium, was in short supply, because of supply and demand. Kaatz said other big countries like China and Brazil are demanding more of the fertilizer.

In a season like this, Kaatz said farmers don't have a choice but to assess their applications per field. He's been doling out advice for managing fertilizer costs.

Kaatz said it's essential to consult a soil test. Results up to three years old are reliable guides for determining fertilizer needs. Most likely, they'll find adequate amounts of phosphorous in their soil but much less potassium.

Once needs are determined, Kaatz suggests farmers "band apply" nutrients, that is, 'band' fertilizer inches away from the plant or seedling.

Kaatz suggests that producers consider applying lime and take credit for nutrients that can come from manure, compost or other materials.

In addition to steep input costs for farmers, the Michigan Farm Bureau points to other factors in the food price jump—severe drought in farming regions around the world, tariffs and export bans imposed on food staples and record crude oil prices. However, ethanol doesn't necessarily play into the mix as some industry analysts claim in the 'food vs. fuel' debate.

They refer to a commodity specialist quoted in the Wall Street Journal who said oil and gas prices would be 15 percent higher were it not for ethanol.

"The last time a bushel of corn and a barrel of oil sold for the same price was 1947, when corn sold for $2.16 per bushel and oil was $2.16 a barrel," the Farm Bureau said in a press release.

"On April 23, 2008 corn was selling for $6.01 per bushel, up 178 percent or $3.85...a barrel of oil was selling for $119.90, up a whopping 5,450 percent, or $117.74."

Overall, food in America is still affordable, Farm Bureau claims. U.S. consumers spend 10 percent of their disposable income on food every year—the lowest average of any country in the world.

Not much can be done to change factors in the world's food market, but locally, the Lapeer Development Corporation hopes to help shoppers save a few dollars and at the same time put those dollars in a local farmer's till.

The LDC has joined a regional effort to develop a local food directory modeled on the Four County Community Foundation's 'Discover the Fun in our Hometowns' brochure.

It will highlight farm markets, community-supported agriculture (CSAs), roadside stands—all attractions that can lure travelers too.

"There is a growing interest in local foods, organics, and other products that tell our local story," Executive Director Patricia Lucas said.

"We hope to be able to do this every year so that we can provide up-to-date information for visitors to our area and other food-related businesses."

To participate, call the Lapeer Development Corporation at (810) 667-0080.

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