WILLMAR — The agricultural trade market with China is likely lost forever and industrial hemp has the potential for new markets in Minnesota, but it won’t provide “rainbows” and “save the world.”
Those were two takeaways from the day-long Partners in Ag Innovations conference Thursday at the MinnWest Technology Campus in Willmar.
The event, which was put on by MinnWest and the Kandiyohi County and City of Willmar’s Agriculture and Renewable Energy Development Committee, featured about a dozen speakers on different aspects of agriculture.
Darin Newson, a market analyst, provided his seven basic rules for following ag markets that focuses on looking at “what” markets are doing and ignoring the “noise” of commentators who try to explain “why” markets are doing what they’re doing.
In response to a question about the ag markets with China as a result of the trade wars and tariffs imposed by President Trump, Newson said American farmers have “lost this fight” and are “not getting that business back.” He noted that the death of hogs in China as a result of the African Swine Fever is doing as much damage to the soybean market as the trade wars.
Newsom said America has “lost its role as a key supplier (of ag products) to China.”
A similar message was delivered earlier in the day by U.S. Rep. Collin Peterson, who was not on the agenda to speak at the conference but is on break from Congress and was at his Willmar office, which is also located on the MinnWest Campus.
Peterson, who is chairman of the House Ag Committee, said the U.S. had everything “we were going to get” with ag trade with China, now American farmers will be “lucky” to end up where the China market started and could likely be “worse off” in the end.
Peterson said he does not approve of the tariffs, which he called “taxes on the American people.”
He said it’s difficult to win a trade war with China when “short-term thinking for the Chinese is 100 years.” Peterson said the chance to negotiate with China was lost in 2001 when China was admitted to the World Trade Organization.
Peterson said the $16 billion in market facilitation payments the Trump administration allocated to farmers to ease the pain of the trade war was a mistake that is controversial, in part, because per acre payments will vary from county-to-county and farmer-to-farmer. The payments were not handled by his committee and "Congress had nothing to do with it," Peterson said, adding that the program is being paid for with borrowed money that is adding to the country's $24 trillion debt.
Peterson was, however, optimistic about the new trade agreement with Mexico, which he supports.
While most of the market talk at the conference was about corn and soybeans, Bethleen McCall talked about her experience raising industrial hemp in Colorado.
McCall said she had a non-farm career and didn’t think she’d be able to work on her family’s farm, but after jumping into the industrial hemp business she’s found success as a fifth-generation farmer.
Industrial hemp, which is raised for the popular CBD oil and different food items like hemp hearts, is enjoying rapid market growth in the U.S. – that despite lingering controversy and regulations with using CBD oil as a health supplement and limited markets for food-grade seeds.
Hemp fibers can also be used to make more than 20,000 different products, however there are currently no large processing facilities in the U.S.
So while the potential for industrial hemp markets are strong – with an anticipated 17% growth anticipated in the seed and fiber sectors – McCall said industrial hemp "will not save the world" and there are challenges that farmers need to be aware of before betting the farm and planting numerous acres into a new crop they may not know a lot about.
Growing industrial hemp for CBD oil involves seeds that can cost anywhere from 50 cents to $2 dollar for each seed. Planting, harvesting and drying this variety of hemp involves expensive equipment, she said.
Growing hemp for food, which is not controversial and is finding places in the commercial food industry, could be a good fit for Minnesota farmers, she said, because equipment used to plant and harvest grain can be used for large-scale industrial hemp production.
Although hemp seeds and hemp products like protein powder are allowed for human consumption, industrial hemp is currently prohibited to be fed to livestock. McCall said efforts are underway to change that.
She also discussed challenges pertaining to lack of applicable herbicides, crop insurance, pests, unstable plant genetics, a predatory environment where farmers have been taken by unscrupulous brokers and law enforcement who can easily confuse industrial hemp with marijuana, which is in the same plant family but has far different levels of THC – the component that gives people a high.
Peterson issued his own caution about industrial hemp, fearing overproduction and the lack of processing facilities could tank the market. “It has the potential of being the Jerusalem artichoke of our generation,” he said.
The event included a meal provided by Model Citizen, a new farm-to-table restaurant operating at Goat Ridge Brewery in New London.
Co-owner and chef Mateo Mackbee was also a featured speaker who talked about basing the menu on the locally grown foods that come through the door, including shrimp raised in Blomkest and lettuce grown at an indoor aeroponics farm five miles away.
Mackbee and his partner and fellow chef Erin Lucas have also formed a non-profit organization designed to teach kids about growing and preparing food, dealing with food waste and options for being food-based entrepreneurs.
Mackbee said they will be expanding their farm to include a greenhouse to provide year-round food production and educational opportunities that will be especially geared to kids who don’t have opportunities to get their hands in the dirt.