Friday, July 23, 2021
CapitalPress.com 7
Farm economy benefi ts
from low interest rates
By CAROL RYAN DUMAS
Capital Press
Eff orts to stimulate
the U.S. economy during
the COVID-19 pandemic
pushed interest rates to
record lows in 2020. Annual-
ized rates on non-real estate
farm loans were 3.7%, beat-
ing out the previous annual-
ized low of 3.8% in 2014.
In the last quarter of
2020 interest rates dipped
to 3.1%. In the fi rst quarter
of 2021, they turned up a lit-
tle bit but were
still
histori-
cally low, said
David Widmar,
co-founder
of
Agricul-
tural Economic
Insights.
The last few
years have seen
a positive farm
economy push-
ing interest rates lower, he
said.
“There’s a lot of uncer-
tainty in the macro econ-
omy, but it’s largely posi-
tive,” he said.
Low interest rates have
benefi ted the farm economy
for nearly a decade, he said.
“The most obvious way
people think about low inter-
est rates is it costs less to
borrow money,” he said.
Low interest rates with
longer repayment terms
made the cost of servic-
ing debt historically low in
2020, he said.
Low interest rates also
impact the farm economy
by increasing the value of
capital investments such as
farmland.
“Lower interest rates
prop up those asset values,”
he said.
When interest rates are
low, buyers are willing to
pay more for a certain asset.
For example, investors will
pay more for an asset at a
1% interest rate than they
will at a 10% interest rate,
he said.
Farm profi ts and lower
interest rates make pur-
chases of farmland more
attractive. As long as lower
interest rates continue, farm-
land values will continue to
increase. That creates a lot
of enthusiasm, he said.
Two things to keep and
eye on are interest rates and
farm profi ts, he said.
Farmers’ costs of bor-
rowing money got lower
in 2020 due to a combina-
tion of low interest rates and
higher profi tability, which
improved the creditworthi-
ness of the farm
economy, he said.
“Looking
ahead, it’s import-
ant to watch what’s
going on at the
Federal Reserve,”
he said.
The
agency
has been saying it
doesn’t expect to
increase interest
rates until 2022 with sort of
a gradual increase over the
next few years, he said.
But given the current
low interest rate, any adjust-
ment could be substantial —
for example, a return to 5%
would be a big shock, he
said.
The economy is leav-
ing the uncharted territory
of the pandemic to a new
unknown — no one’s sure
what’s ahead for economic
growth, unemployment and
infl ation, he said.
If it’s a sluggish econ-
omy, interest rates might
not rise as fast as the Fed-
eral Reserve expects. On the
other hand, if the economy
recovers quicker and stron-
ger than expected, the Fed-
eral Reserve cold raise inter-
est rates sooner than 2022,
he said.
He likens the economy to
a car on a road that’s uphill
or downhill, straight or
curvy. The Federal Reserve
either gives it gas or stimu-
lus to keep it accelerating or
applies the brakes to slow
things down and keep them
safe, he said.
Drought top concern
for new Idaho Wheat
Commission chairman
By MATTHEW WEAVER
Capital Press
The new chairman of the
Idaho Wheat Commission
looks ahead to lower yields
as dry weather continues to
grip the region.
“Yields are expected to
be down most every where,”
said Rockland Valley farmer
Cory Kress. “That’s proba-
bly going to put a strain on a
lot of farmers fi nancially. It
weighs on everybody men-
tally, probably as bad as the
fi nancial aspect of it.”
The drought emphasizes
the importance of a strong
crop insurance program as
the industry begins discus-
sions on a new farm bill in
Congress, he said. Funding
for export programs is also
critical.
“This next farm bill
might be really interesting,
with how we tie (in) conser-
vation and what we do with
things like carbon sequestra-
tion,” he said. “Those things
might be a major part, which
is going to be kind of new
and unique from any of the
past farm bills.”
Kress joined the commis-
sion in the 2020 fi scal year.
He will serve as chairman
for 2021-2022.
“I wouldn’t say I’m look-
ing to radically change any-
thing,” he said.
Instead, he hopes to con-
tinue
the
commis-
sion’s mis-
sion: mak-
ing farmers
more profi t-
able through
Cory Kress f u n d i n g
research,
trade promotion and advo-
cacy to legislators.
Kress welcomes feed-
back from growers.
He farms 9,000 acres and
has been farming for himself
17 years.
His wife, Jamie, is pres-
ident of the Idaho Grain
Producers Association.
“The upside is we travel
to the same places a lot,”
Kress said. “It’s not taking
us away from each other
as much as it would be if
it was just one or another.”
They have two children,
Tyson, 16, and Hailey, 13.
Kress appreciates how
in farming, unlike other
jobs, he can see what he’s
accomplished at the end of
each day, whether cutting
a fi eld, seeding or a shop
project.
“You put your time and
eff ort and blood, sweat and
tears into a crop, nurture it
the best you can and watch it
grow,” he said. “That’s prob-
ably why the drought is so
disheartening, because you
see daily your blood, sweat
and tears just wither away.”
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Unforeseeable path takes Scharf
from farmer to state lawmaker
By MATEUSZ PERKOWSKI
Capital Press
The prospect of being appointed to
the Oregon Legislature didn’t even cross
Anna Scharf’s mind when she took an
off -farm job last year.
Working as a legislative policy ana-
lyst for former Rep. Mike Nearman,
R-Independence, was simply a chance
to deepen her involvement in politics —
but not to eventually take his seat in the
House.
Yet that’s exactly what’s happened
after Nearman was expelled from the
Legislature in June for allegedly allow-
ing protesters into the State Capitol last
December, when it was closed to the
public due to coronavirus restrictions.
Scharf was sworn in to offi ce July 12
after commissioners from Polk, Yam-
hill, Benton and Marion counties voted
to appoint her as the representative for
House District 23 in the western Willa-
mette Valley.
“It’s not the traditional way to get into
offi ce,” Scharf said, but she’s nonetheless
appreciative of the community support
that’s made her new role possible.
She also remains grateful to her for-
mer boss, Nearman, who provided her
with the original opportunity as a legis-
lative aide.
“Every good person makes a mistake,
and we’ll just leave it at that,” she said.
Scharf ordinarily works as the offi ce
manager for Scharf Farms, a diversifi ed
operation near Amity, Ore., that’s run
by her husband, Jason. She’s primarily
in charge of personnel management as
well as tracking the 10 million pounds
of seed cleaned at the farm each year.
“I farm paper,” Scharf said. “I do all
the non-fun stuff .”
She’s no stranger to the statehouse,
which she’s frequently visited over the
years to advocate for legislation aff ect-
ing the agriculture industry.
After graduating from Southern Ore-
gon University, Scharf worked for a
lobbyist who pushed to prohibit ciga-
rette vending machines
in the early 1990s as a
way to reduce under-
age smoking.
Though she was
drawn to politics,
Scharf realized there
Anna Scharf was more steady
employment
avail-
able in the supply management fi eld.
She worked for Hewlett Packard and
other companies in this capacity while
earning a master’s degree in business
administration.
About a decade ago, she stopped
working off -farm to dedicate herself to
raising her son and daughter, though she
soon became re-engaged with her pas-
sion for politics by regularly testifying
before lawmakers.
Increasing the ability of Willamette
Valley farmers to grow canola has been
an ongoing campaign for Scharf, who
began supporting the crop as a “right
to farm” issue before her family’s com-
pany even grew it.
Canola has proven controversial in
the region because farmers want a new
rotation crop and source of income, but
specialty seed companies fear cross-pol-
lination with related crops, among other
issues. Currently, canola production in
restricted to 500 acres per year in the
valley.
Scharf also pushed for the expan-
sion of “slow pay-no pay” protections
for crops other than grass seed. Growers
who farmed grass seed had to be paid
within a certain amount of time, but that
requirement didn’t apply to clover, tur-
nip, radish and other commonly con-
tracted seeds.
“Why don’t you get payment protec-
tion for those?” Scharf wondered. A bill
that expanded payment protections to
those crops was unanimously passed by
the full Legislature in 2018.
Scharf and other farmers were heav-
ily involved in discussions over rais-
ing the state’s minimum wage in 2015,
which resulted in a three-tiered system
WSDA hurries to hold down Japanese beetles in Yakima County
By DON JENKINS
Capital Press
Japanese beetles are
being caught by “bag-
fuls” in and around Grand-
view, Wash., heighten-
ing concern about a new
pest infestation in Central
Washington.
The
Washington
Department of Agriculture
will hang 3,000 more traps
as fast as it can to catch as
many beetles as possible
this summer, department
spokeswoman Karla Salp
said.
An eradication eff ort
with chemicals will have
to wait for an environmen-
tal assessment. The depart-
ment also may establish a
quarantine to regulate soil,
plants and other material
that can harbor beetles.
“This is going to be a
multiyear, long-term proj-
ect,” Salp said. “As far as
WSDA
A Japanese beetle clings to a plant in Yakima County,
Wash. The Washington State Department of Agricul-
ture reports trapping the pest by the “bagfuls.”
damage to agriculture and
potential impact, the Japa-
nese beetle is much more
of a threat than the Asian
giant hornet right now.”
Japanese beetles, estab-
lished in the eastern U.S.
but rare in Washington,
have a wide-ranging diet
that includes fruit, hops,
grass and asparagus.
The department trapped
two Japanese beetles last
year in Grandview and
one in Sunnyside, both
in Yakima County. Plus,
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a
Grandview
woman
reported fi nding dozens of
beetles on her roses.
This year, the depart-
ment, alerted by the wom-
an’s report, put up about
500 traps in and around
Grandview
and
are
catching too many bee-
tles to keep a running
count.
“We’re catching them
by bagfuls at a time,” Salp
said. “This is a much big-
ger problem than we antic-
ipated at the end of last
season.
“We need to get these
traps up and get as many
beetles out of the environ-
ment as possible,” she said.
The Oregon Department
of Agriculture has been
battling Japanese beetles
for several years in Port-
land and its suburbs. The
department treats lawns
and fl ower beds with a
granular larvicide.
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with diff erent rates for rural counties,
standard counties and the Portland met-
ropolitan area.
Finding this “common ground” has
helped shield farmers and rural employ-
ers from potentially even higher spikes
in labor costs, she said.
Looking to the future, Scharf antic-
ipates that her immediate concern as a
lawmaker will be negotiations during a
September special session about redis-
tricting, or the re-drawing of boundaries
for legislative districts.
Recent controversies over ending
the agricultural exemption from higher
overtime wages and stricter air quality
rules for workers may be revived during
future legislative sessions, she said, add-
ing that water management and wild-
fi re mitigation are bound to be perennial
natural resource concerns.
Aside from those issues, Scharf will
have to focus on campaigning to win a
full two-year term during the 2022 pri-
mary and general elections.
“I’m really waiting to hear what’s
important to constituents,” she said.
With her appointment to the Legis-
lature, Scharf is the seventh lawmaker
who’s also an Oregon Farm Bureau
member.
The organization is excited about her
appointment, since there are “conversa-
tions that only legislators get to be in,”
which provides farmer-lawmakers with
“an incredibly powerful voice,” said
Mary Anne Cooper, OFB’s vice presi-
dent of public policy.
“It will yield only positive results,”
she said. “They can speak up in ways
that lobbyists and members of the pub-
lic just can’t.”
Farm-related legislation is often
reviewed by committees that aren’t
strictly devoted to natural resources,
so Scharf will be valuable regard-
less of her assignments, Cooper said.
“No matter where Rep. Scharf lands,
there will be agricultural issues we
care about that will wind up in front
of her.”
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