Minnesota agriculture news roundup on government shutdown, Thanksgiving prices

NINA MOINI: It's time for our weekly check-in with the MPR News regional team. Yay! Today, Ruiz Sandoval is our agriculture reporter based in Moorhead. And he's here to share his reporting as he checked in on the AG economy. Thanks for being with us today, [? all. ?]

RUIZ SANDOVAL: Hey. Hey, Nina. Glad to be here.

NINA MOINI: Always love to chat with you. You are out and about. You are chatting with people. I love to see it. You started not too long ago with us, and I just-- I love all the work you're doing. Let's talk about it.

RUIZ SANDOVAL: Thank you.

NINA MOINI: Some of these ripple effects of the government shutdown for farmers-- you've been covering that a lot. What kind of government programs do these Minnesota farmers rely on that are being impacted.

RUIZ SANDOVAL: Yeah, I got to focus a lot on conservation programs that farmers have signed up for. Now, these are programs that pay farmers to adopt conservation practices, like tilling the groundless or planting cover crops on their fields.

And what's interesting is that these are really business contracts, like a farmer agreed to do something on their farm, and the government agreed to pay them. But for the month and change that the government was closed, no one was there to process any of those contracts or payments to many of these farmers.

NINA MOINI: Wow! So what is the impact from the folks you're talking about?

RUIZ SANDOVAL: Well, because we've been delayed for over a month now, it can have a tremendous impact on you, depending on how you've structured your finances. Many may have built their budget around the belief that this check was going to hit on time.

I spoke with a farmer named Vance Johnson, who was on the hook for about $40,000, and he said that had he had known that there was going to be a delay, he would have sold more crops to offset all that money that he's missing right now.

NINA MOINI: And it's not just the shutdown. Today, you've been doing some reporting on some of the other general economic outlook problems that people are saying. What does the data say?

RUIZ SANDOVAL: We are on about two to three years of constant declining farm incomes. That means that farmers are looking to renew or get more of those loans to make up for that lost income that we're seeing, to be able to keep their operations going.

Now, at that same time, they're repaying their current loans less. They're paying them at a lesser rate. Now, that doesn't mean that they're delinquent or they're missing payments. It just means that they're making more of those minimum payments that slowly chip away at their debt.

NINA MOINI: That's too bad. But there is some good news, right?

RUIZ SANDOVAL: Yeah, that's right. I mean, two things right now are also happening at the same time. A, land values are up. But also, cash rents are down. Now, a cash rent is when the tenant pays a fixed cash amount to the landowner for the use of the land.

Now, it's typically agreed upon at the beginning of the lease term, which is pretty important. Because right now, many of those leases are up for renewal. So in theory, tenants should be able to negotiate for lower rent payments, especially as the Federal Reserve has cut down on interest rates, which should impact also how much banks charge customers for loans.

NINA MOINI: So we've talked about some of the crops. There are also livestock farmers, though. Cattle producers in Minnesota want to raise what's called a checkoff fee. Can you explain what that is, and why they want to raise it?

RUIZ SANDOVAL: Oh, yeah. So since it was voted on in 1986, farmers pay a $1 fee for every head of cattle that they have. $0.50 of that goes to the National Beef Checkoff, and the rest goes to our own Minnesota Beef Council. Now, that money is used to promote research and innovation, to drive up the demand for beef. And since 1986, that fee here in Minnesota has remained at just $1.

I spoke with leaders at the state level who said that working with the same budget for 40 years is pretty tough. And with costs rising, they're hoping producers approve raising that $1 fee to $1.50.

Now, if that passes, farmers who don't want to pay the extra fee can ask for a reimbursement of those additional $0.50. But it still might be kind of a tough sell for producers who are also feeling the squeeze of higher costs.

NINA MOINI: So we've talked about cattle producers. Let's talk turkey today. Minnesota's the largest turkey producer in the country. We're coming up on Thanksgiving. You just published a story about the cost of the Thanksgiving turkey this year. I haven't had a chance to look at it yet. How much are we looking at here?

RUIZ SANDOVAL: Well, I mean, if you're buying an average 15-pounds turkey, that could bring you up to around $30, which is a 25% increase from last year, according to a Purdue University study. A lot of it has to do with the higher cost of feed that producers face.

Turkey chow makes up 60% to 70% of their production costs, and certain additives that go into that feed, like minerals, vitamins, et cetera, are being tariffed by the Trump administration.

Now, that doesn't mean retailers will necessarily pass on all of those costs to consumers. Walmart, for example, is selling turkeys at just below $1 a pound in their annual meal deal. So if you want to save, I'd say look around for bundles. Shop early, and really just make a budget.

NINA MOINI: How about-- you mentioned some of the costs for producers. But bird flu is a concern right now, too, right? Is that having an impact on these prices at all?

RUIZ SANDOVAL: Well, it's not necessarily causing frozen turkeys, like the whole turkey, to be more expensive per se, but it's also not helping. Supply and demand tells us that the more of a good that you have, the less valuable it will be.

So if we have higher turkey populations, each individual turkey should, in theory, be cheaper. But with bird flu killing around seven million commercial fowl this year, that's unlikely to happen.

NINA MOINI: These are such good tips. And so I know you were talking about bundling. What do you think-- are there any other tips that you came across when you were looking around?

RUIZ SANDOVAL: Yeah, I mean, bundling. Also, looking at, if you don't want to buy turkey, what else you could do? Roast beef is oftentimes popular, but beef prices are also high. So that may not be as great of an idea.

I myself, while I was reporting this, kind of, spooked myself with all the facts I was finding. So I bought a duck to roast for Thanksgiving. I think it rung me up to about $20. But also, looking at side dishes that have remained consistent with prices, bread-- or ingredients that go into making a side dish at least, like bread-- could help you make up for different types of sides to make up for that meal.

NINA MOINI: Anything else today that you're looking forward to eating on Thanksgiving?

RUIZ SANDOVAL: So this is my first Thanksgiving as a self-sustaining adult. So I'm going to be experimenting--

NINA MOINI: I thought you were going to say in Minnesota because it is. But that's good, too. [LAUGHS]

RUIZ SANDOVAL: Both, too. So I am going to be trying Minnesota cuisine. But at the same time, I'm thinking of maybe roasting some carrots, squash, pumpkin. In my household, it's just me and my lovely girlfriend, Marina. So our stomachs aren't that big. So we'll try and probably have a more modest Thanksgiving dinner for each of us.

NINA MOINI: OK. Yeah, a little adult-- what did you say, your first year as an adult?

RUIZ SANDOVAL: As a self-sustaining adult. It's my first time having a whole job. So it's pretty-- at least like a real job here. So it's really cool.

NINA MOINI: I'm so happy for you today. Thank you so much. Have a great Thanksgiving, and thanks for sharing your reporting with us.

RUIZ SANDOVAL: Thank you so much. Happy Thanksgiving, everyone.

NINA MOINI: Thank you. That's MPR News agriculture reporter, Tadeo Ruiz Sandoval, reporting from Moorhead.