Farmers Cope With Drought, Cut in Federal Subsidies

Gary Gollehon hasn’t scratched a profit from his farm in years. Last spring, he gambled again, planting much of his farm near the Rocky Mountain Front to high-quality malting barley, only to see it wither in the powder-dry soil and be sold instead as cheaper livestock feed.

Coming off a bad drought and a bad crop, coupled with high fuel and fertilizer prices, Gollehon isn’t buoyed by the knowledge that his federal farm payments also are about to be cut--again.

“There have been too many dry years,” said Gollehon, who farms with his son-in-law in west-central Montana. “We’re hoping for a good year, but hope’s running out here.”

Payments to farmers with production flexibility contracts will be 20% less next year than this year, said Bruce Nelson, state executive director of the federal Farm Service Agency for Montana. It is the single largest drop under the seven-year schedule of declining payments set out in the 1996 farm law.

The law was designed to ease farmers’ long-term dependence on the government by ending a decades-old system of production controls and lowering federal price supports. In turn, farmers were guaranteed continued--but diminishing--payments through 2002. They also would be able to plant whatever they liked, without the risk of losing government subsidies.

Supporters called the program “Freedom to Farm.” Opponents dubbed it a more ominous nickname--”Freedom to Fail”--and they say that has proved more accurate.

The expected rise in commodity prices after the adoption of the farm legislation never materialized. Meanwhile, farm payments, which did not allow for any adjustments for the low market, continued to fall.

In Montana, payments will drop from about $117.5 million this year to about $95 million next year, said Bill Flanigan, FSA program specialist. In Wyoming, payments will fall from $7.5 million to about $6 million.

Producers in Montana, Wyoming and other states have received emergency federal assistance to tide them over. But experts admit it’s no solution.

“I don’t know if there’s a basis for optimism here, but there is going to be assistance available,” Nelson said.

In Montana, millions of dollars have been paid to help farmers get water to their livestock. And land in the Conservation Reserve Program was opened to haying and grazing to help relieve the shortage of hay for livestock.

Drought affected most of Montana and Wyoming. But even areas that received enough rain and had better crops, such as northeast Montana, have dealt with sprout damage and undesirable protein levels in crops, Nelson said.

In Glacier County, where drought has prevailed for three years, livestock already have grazed on much of the small grains that weren’t salvageable, extension agent Darren Crawford said.

“It’s really tough on people who have started in the last few years, generally because of their debt load,” he said. “Some guys who went in without a debt load probably have some now.”

Cattle in central Wyoming have been grazing on winter pastures for up to two months, when they’re normally not turned out until Nov. 1, because water on their summer range dried up, said Natrona County agent Tom Heald. Additional feed for coming months may be necessary.

Casper-area rancher Stacey Scott rented 90 acres, besides his own land, this year, expecting to sell the extra hay he produced. But with drought and wildfire burning about one-third of his grazing land, Scott figures he might have enough for himself if he’s lucky.

“If I hadn’t rented land, I’d be hurting,” Scott said. “But droughts happen here. There were other guys who had it a lot worse.”

“There is stress here and the attitude, What’s next?” Heald said. “But I get the sense that, we made it through so far, we’ve just got to keep going.”