LANCASTER (Lancaster Co.)
Exports are brightening the
agricultural outlook, but since
exports arc politically driven, pit
falls abound. This was the concen
sus from the speakers participating
in Core States Bank’s agri
education seminar on Thursday.
Sonja Hillgren, Farm Journal
editor, opened the day-long semi
nar that focused on partnering to
make agriculture stronger by
addressing how partnering meets
world demand.
Hillgren spoke of China’s vola
tile past and Ijow she perceives it
will influence world trade.
“The U.S. trade deficit with all
foreign countries last year swelled
to $ll4 billion, the largest deficit
in eight years,” Hillgren said.
Of these figures, she pointed out
that the U.S. trade deficit with Chi
na is $4O billion and growing.
Although the figure with Japan is
higher, the trade deficit is on a
downward trajectory and it is pro
jected that China’s deficit soon
will overtake Japan’s.
China’s power in agricultural
trade will “wrap into one giant
bundle the problems we have
experienced in the past with both
Speakers at the annual agri-education seminar gather with Corestates Bank offic
ers. Front from left are Dr. Mark Edeiman, Lawrence Delp, F. Barry Shaw, and H. Louis
Moore. Prom back left, Dr. Barry Flinchbaugh, Joseph Del Tito, Sonja Hiilgren, Darvln
Boyd, Jimmy Mullen, Andy Young, David Kohl, and John Blanchfleld.
Grand Opening
Partnering Strengthens Agriculture’s Future
Japan and the former Soviet
Union,” she said.
“China’s internal ups and downs
and our ups and downs with
China will affect farmers in
Lancaster County. Chinese agri
cultural and trade policies will
affect the price of feed for poultry,
hogs, as well as pork and poultry
exports.”
“We in American agriculture
are increasingly dependent on our
fortunes in Asia to which we are
shipping $24 billion worth of agri
cultural products this year. Exports
to Western Europe are only $9
million.”
A recent study by International
Food Policy Research Institute
predicts that China’s grain imports
will hit record highs over the next
two decades and can be met by far
mers in tjie U.S., Canada, and
Australia.
Since Chinese markets are so
politically volatile, people fear a
repeat of the 1970 s boom followed
by a bust in the 1980 s, but Hillgren
said many things are different in
this era.
Most customers are free-market
economies rather than bankrupt
Communist regimes. Exports are
less dependent on taw commodi
ties and involve more value-added
products.
On the other hand, value-added
products open up a whole new set
of problems. With Exoli outbreaks
and British mad cow disease,
imparted safeguard measures are
being imposed by several
countries.
Hillgren and several other
speakers addressed the problems
that arise from the stronger value
of the U.S. dollar compared to
other currencies. Japanese purch
ases of U.S. exports in particular
are limited because of this. If inter
est rates are raised, the increase
will make U.S. products more
expensive and harder to expert and
importing will seem more feasti
ble.
To help modify the negative
aspects of .exporting, Hillgren
recommends that Congress be
required to write a good agricultur
al research law this year, that a
steady increase rather than cuts be
established in foreign develop
ment assistance, that free trade
agreements be negotiated, that a
global mechanism be established
for handling health and safety
issues, that environmental policies
protect our land base without mak
ing production difficult, and that
Crop Revenue Coverage be avail
able to all farmers.
David Kohl, ag economics pro
fessor. spoke of partnering to take
charge of change.
“If you don’t take charge,
change will take charge of you,” he
said.
While the past years have been
difficult for many farmers, Kohl
said the real winners are emer
ginng in agriculture with the better
getting better and the worst follow
ing behind.
Kohl encouraged farmers to
consider spending money in order
to make money in value-added
products, which he sees as the
most profitable aspect of
agriculture.
With a relatively strong eco
nomy, Kohl warned against being
caught up in the micro-macro trap,
“which is making a long-term
decision based on short-term
outlook.”
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made by people are based on emo
tion, Kohl said there is a tendancy
to expand operations when busi
ness is prospering. He cautioned
farmers to consider how they could
meet expenses if prices decline.
Kohl said that in the 19605, the
food budget was 30-32 percept of
the household budget compared to
10-12 percent today.
“If it wasn’t for strong agricul
ture, we couldn't do what we do
now,” he said. He encouraged far
mers to educate the public where
seven out of 10 people have never
stepped foot on a farm.
As farms expands to incorporate
more family members. Kohl said
that it isnecessary that one person
“be the top dog” when it comes to
making tough decisions. He said
that it is better for a younger person
to work for someone else three to
five years before working on the
family farm. This enables them to
make mistakes on someone clse’s
money and to pick up new ideas.
Contrary to public opinion, it costs
a 65-year-old couple 125-150 per
cent more to live than a younger
couple. Kohl said, and this figure
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