Are You Aware? How Farmers Survive

This is part II in our “Rural America” Awareness Wednesday series. Read the other posts in the series here.

Do you know how farmers survive? They have relied for decades on USDA loans. Every year many farmers apply for loans to buy or rent farmland, to buy seed or stock or equipment or fertilizers, and even to cover living expenses. Many farmers could not operate without loans. It’s an annual cycle of borrowing at the beginning of the crop year to purchase the needed items, and then paying up at harvest and not having enough cash reserves to start the next growing season — and then beginning the cycle again.

Timing is everything in farming. Even home gardeners have had the frustration of going to the nursery, wanting a plant or seed, and finding it out of stock. This can happen to commercial farmers, too. In addition, in the commercial market, seed prices can fluctuate throughout the planting season. And the ideal time to plant can be a very small window. Late harvests can command the lowest prices of all, with lower yields per acre.

In 1994, the USDA commissioned a consulting firm to analyze the treatment of minorities and women in Farm Service Agency (FSA) programs and payments. Their findings were not surprising. They found that from 1990 to 1995, minorities received lower loan amounts and, often, later decisions on those loans. Low or late loans can be disastrous for farmers. In 1983 the Civil Rights Office for the USDA was closed; there was nowhere for complaints to be resolved. If a crop is insufficient to cover the cost and interest on a loan, the farm can be foreclosed on.

This discrepancy has led to a loss of 12 million acres of Black-owned farmland since the 1950s. There are about 3.5 million farmers in the U.S. Fewer than 45,000 are Black, down from about 1 million Black farmers a century ago. That is about 14% of farms owned by Black farmers down to now 2%.

At the beginning of the pandemic, the USDA launched its Farmers to Families Food Box program. This program made direct payments to farmers to stock food banks and community groups that were suffering during the pandemic. In the first two rounds of funding, most of the funds went to small farmers who were in danger of losing income due to the closing off of revenue streams such as schools and restaurants. In later rounds, funding was shifted to large corporate farms. Small farmers — including many Black farmers — were left out and imperiled by the loss.

In Puerto Rico it was reported that the food boxes contained items imported from the mainland, including some canned foods, and that the cost of each box was $100. There are estimates that each box was actually worth between $25 and $40. A corporation, Caribbean Produce Exchange, was the supplier. Puerto Ricans felt that this was a missed opportunity to provide aid to local Puerto Rican farmers and that the cost was too high. Caribbean Produce Exchange, although being paid top dollar, failed the community in many ways. At one food distribution event, more than 600 families lined up for a food delivery that never came. It is unclear whether CPE was paid for boxes never delivered.

It seems that farming has become full of pitfalls. Many poultry and animal farmers are no longer raising their own animals but are instead contract farming for larger corporations. Many of these corporations have strict rules for their growers. They must make whatever improvements the corporation requires to house their animals; they have no control over the feed, medical care, or selection of the animals that they raise. Many have lost their land due to strong-arm tactics of the corporations after trying to organize growers to lobby for better pay and working conditions.

Minority and women farmers have been squeezed out for decades due to discrimination on one end and corporate greed on the other. In the American Rescue Plan, $4 billion has been set aside for payments to minority farmers who are defined as “socially disadvantaged farmers and ranchers,” and “a group whose members have been subjected to racial or ethnic prejudice.” These payments will be largely forgiveness of currently outstanding loans.

John Boyd Jr., a fourth-generation farmer in Virginia and the president of the Black Farmers Association, has explained, “If [the U.S. wants] the next generation of farmers — Black farmers, that is — they have to open up their purse strings and find a way to let us be a part of American farming fabric where we can compete.” He has also explained the loss of dignity Black farmers feel from the USDA’s discrimination and has spoken about being foreclosed on by the USDA and being refused debt relief or restructuring of his loans. Meanwhile, many white farmers have received such relief and restructuring. Debt processing time has taken, on average, about ten times longer for Black farmers than white.

Boyd has spoken of being spit on by loan officers and of having his application thrown in the garbage. He has spoken of the loan officer only meeting with Black farmers one day a week with the office door open so that each could hear how rudely he spoke to the others.

In 1995 Boyd founded the National Black Farmers Association after meeting with many Black farmers and hearing similar USDA experiences. Many told him that their experiences with the USDA were even worse than his.

The American Rescue Plan may prevent further loss of Black farm ownership. One way of ensuring that this money is allocated to the minority farmers who are entitled would be to put the responsibility on the USDA to send out direct payments, or administratively eliminate the debt of farmers the same way that stimulus checks have been sent to taxpayers.

As we read in last week’s Awareness Wednesday piece, there are many rural communities that struggle with access to the Internet, and literacy and English language proficiency may be low for many rural minorities. As with the Small Business PPP loans, administrative stumbling blocks stand in the way of minority populations. This time, we hope the government will reach out with relief to these communities and get them the help they need.