Higher Costs Mean Hard Choices For Rice Farmers

February 2, 2006--Posted at 4:30 p.m. CST

CRAIGHEAD COUNTY, AR--Rice has always been synonymous with Northeast Arkansas agriculture. But the Arkansas Agriculture Secretary says farmers are facing tough decisions with their crops.

"Everybody's just trying to survive out here," said area farmer Joe Christian.

Limited rainfall and higher production costs are driving rice farmers in Region 8 to make hard decisions about their livelihood.

"A lot of the indications that we are seeing is there is going to be a reduction in the rice acres by 10 to 20 percent. Ultimately there are going to be farmers going out of business." said Branon Thiesse Craighead County Extension Agent.

With fuel prices at over 2 dollars a gallon and fertilizer at 400 dollars a ton, the low price for a bushel of rice is driving a number of rice farmers in the area to farm soy beans. But this too presents a problem of supply and demand.

"If we drop our rice and plant our soy bean and we hear all around the country that there is going to be more soy bean acres that is going to cause the cost of soy beans to drop," said Christian.

Farmers are making the switch to soy beans because it a lower cost per acre crop, but in some cases soy beans aren't even profitable and a number of fields in Region 8 will go unused this year.

"It's my understanding they are already having trouble finding renters for some of this ground and it's just going to get worse unless we get better prices for our crop," said Christian.

For a country that has the cheapest food costs in the world the impact of a drop in production could be felt across the region.

"I think you are going to see a ripple effect, car dealers sell a lot of trucks to farmers, equipment dealers it will just go on down," said Christian.

For farmers who depend on the ground to make their living and are feeling the pinch of prices, they hope this uncertainty is temporary.

"It usually goes in cycles, it will probably get better but there is no guaranteeing that," said Christian.

We talked to Bill Reed of Riceland who says it is way too early to predict if Riceland would have to make any personnel changes based on a drop in rice production.