Rising production costs, particularly for energy-dependent irrigation pumping, could force Delta rice producers to turn to other crops, says Cleveland, Miss., producer Bill Ryan Tabb.
“Much of the rice industry could very well disappear in Mississippi,” he told members of the Mississippi Agricultural Economics Association at their recent annual conference on “The Evolving Global Energy Market: Challenges and Opportunities for Agriculture.”
“To me, that's scary,” he said. “There's not much economy in the Delta area outside agriculture. If we lose agriculture, not only the Delta's in trouble — the economy of the entire state will also be impacted.
“Millions and millions of dollars have been spent on economic development in the Delta and, for the most part, it hasn't worked. The only sustainable industry in the Delta has been agriculture.”
Cutting costs and improving efficiency have become the top concerns for farmers as they try and cope with across-the-board increases for inputs and market prices for their crops that often hold little hope of profits, says Tabb.
With that kind of scenario, “It's impossible for me to sit down in February and forecast numbers that will let me break even, let alone show a profit.”
Not long ago, he says, “I was paying 87 cents a gallon for diesel; now it's $2.27. Most of my power units are diesel and each one costs $200-$225 per day to run. I paid $120-$145 for a ton of urea; now it's $300-$320. Transportation costs have gone through the roof; chemical prices keep increasing; virtually everything the farmer uses is affected by energy costs.
“But I'm making 75 cents a bushel less on rice than I was then, and $2.25 less on soybeans. Granted, we're getting higher yields, but it still doesn't even out.”
There's only so much that can be done to hold the line on costs, says Tabb, who farms with his father.
“We've changed a lot of practices to cut corners without adversely affecting yields. We once wouldn't put a soybean in the ground before May 1, but thanks to the work done by (Mississippi Extension soybean specialist) Alan Blaine and others, we've pushed planting up by nearly two months, which helps reduce the need for irrigation and allows us to harvest earlier.
“We started planting beans March 3rd this year and we've already been watering three weeks in June. That's not supposed to happen, but June has been abnormally dry.
“We also got a lot of help from Mississippi Extension specialists in irrigation planning and efficiency — even things such as working with drivers to keep tractor RPMs at the most efficient level. Every place we think we can trim pennies, we try it.”
Tabb says many of his fellow farmers are also trying twin-row cotton in order to reduce irrigation costs.
“We're buying used equipment instead of new, we're using no-till, we're using polypipe for irrigation — we're doing everything we can to conserve water and cut costs, but it's still hard to make it. There's just no magic for saving $50 per acre on rice production costs.”