The lingering effects of years of hurricane damage and the current economic downturn are dampening Louisiana agriculture, a group of industry observers told an Agribusiness Leadership Summit Forum recently.
Patrick Jordan, director of the U.S. Department of Agriculture’s Southern Regional Research Center in New Orleans and president of the Agribusiness Council of Louisiana, told the audience of industry leaders, producers and elected officials meeting in Baton Rouge that agriculture is not the only industry that’s in trouble.
“There are a lot of other people in trouble with us,” Jordan said. “I think it’s important for us now to look for ways to dig ourselves out of some of these major problems.”
The forum was a follow-up to an earlier meeting held in September in New Orleans, according to Steve Mullen, LSU AgCenter regional director.
“With the many issues facing the Louisiana agricultural industry, we wanted to bring these agricultural leaders together again,” Mullen said.
The meeting was sponsored by the agribusiness council, the Louisiana Department of Agriculture and Forestry, the LSU AgCenter and the Southern University Ag Center.
“Since we last met, a lot of things have changed,” said Mike Strain, Louisiana Commissioner of Agriculture and Forestry. “We’ve seen a collapse in the worldwide economy. There are definite shifts in trading patterns, shifts in banking patterns and shifts in everything that we are going to do. It’s important that we look at that, understand it and attack it.”
Strain said now is not the time to be complacent. “Right now is the time to aggressively look at all the opportunities in those clouds. In those dark clouds, there is rain, thunder and lightning, but after that, there will be a great rainbow,” he said.
It’s going to take the economy getting better and generating more confidence in the markets in order to get more investors back, said Kurt Guidry, an LSU AgCenter economist.
“This recession is different from the past because of outside markets like the financial markets and the energy markets,” Guidry said. “What’s happening in those markets is dictating what’s happening more and more in the agricultural market.”
The sugar industry in Louisiana is looking at ways to cut producers’ costs by encouraging them to adopt some cooperative practices, said Jim Simon of the American Sugar Cane League in Thibodaux, La.
“We’re showing the producers that they could decrease some of their expenses by purchasing as a group instead of individually,” Simon said.
Jess Barr of the Louisiana Cotton Producers Association said the cotton and soybean industries in north Louisiana sustained heavy damage from hurricanes Gustav and Ike.
“Our yields were roughly cut in half as a direct consequence of the storms, and we had four gins to shut down,” Barr said. “We’ve got warehouse capacity to store about 1.2 million bales of cotton, but this year’s crop was less than 300,000 bales.”
C. A. “Buck” Vandersteen, president of the Louisiana Forestry Association, discussed the need for more agricultural research and explained the consequences of not receiving it. He said it seems agriculture is not on the government’s radar.
“In the stimulus package, there are allocations of $9 billion for the National Institutes of Health and $3 billion for the National Science Foundation, but nothing for agriculture research,” he said.
Vandersteen said a $1 million investment to plant trees in Louisiana will yield $8.5 million in new taxes for the state in addition to $85 million of economic activity.
The state’s $1.2 billion poultry industry has been greatly affected by the announced closing of the Pilgrim’s Pride plant in north Louisiana, said LSU AgCenter poultry specialist Theresia Lavergne.
“The poultry industry is the largest animal agriculture industry in the state — second only to forestry,” she said. “The industry is vertically integrated, which means the producers are at the mercy of the company they are producing for.
“We are happy that the governor and Dr. Strain are moving to look for ways to get the plant back in operation,” Lavergne added.
A panel that included Willie Cooper of the USDA Farm Service Agency, Leo Nelson of the Louisiana Bankers Association and Randy Rogers of the Louisiana Agricultural Financial Authority said the state’s agricultural producers have a number of avenues for loans and technical assistance that can help them stay in business.
Paul Coreil, LSU AgCenter vice chancellor, explained the serious condition the AgCenter will be put in if the state’s higher education budget for the next fiscal year is cut as much as is forecast.
“At the AgCenter, we can’t raise tuition to fill holes in the budget, but we will do our best to maintain an acceptable level of support for our clients, but it won’t be easy,” Coreil said.