Louisiana rice farmers are left wondering where to turn as rice prices continue to plummet due to a nation-wide surplus.
“It’s simple economics,” said Bob Papanos, vice president of the U.S. Rice Growers Assoc. “Our supply of rice is too large so the demand just isn’t there.”
Papanos said farmers do not know where to look for buyers because the total surplus from rice-producing states in the country was one million tons higher this year than expected.
Papanos said south Louisiana farmers were hit particularly hard by the surplus because they have to compete in already limited foreign markets with states like Arkansas, which produces 47 percent of the nation’s rice and also had a huge surplus.
“U.S. rice is more expensive than Indian or Chinese rice due to the strict quality standards we have here,” Papanos said. “And because the foreign markets know the U.S. has a huge surplus, they want us to lower our prices.”
Lower prices are bad news for farmers because many depend on using the profits from the sale of their crops to payoff loans on their lands and equipment.
“My family cannot pay back our loans until we sell our rice, and even if we sold right now we would be in debt,” said Karen McClelland, an agricultural business junior from a rice farming family. “The prices are just too low.”
Bill Dore, president of Supreme Rice Mill, said the rice industry is looking everywhere for buyers.
“We hope to sell part of [the surplus] to governmental aid programs,” Dore said.
Papanos said the tsunami-ravaged nations bordering the Indian Ocean last year looked to be a possible outlet for rice farmers, but those nations are not buying.
“Many of the governments are encouraging their people to produce their own rice because it will help to stimulate the economy, and it is cheaper than going overseas to buy it,” Papanos said.
Papanos also said farmers looked to Iraq for possible buyers, but Iraq has been buying its rice from Taiwan.
Jerry Whatley, county agent with LSU’s AgCenter, said farmers in Louisiana do not have many options to overcome the agricultural crisis.
“Rice farmers in southwest Louisiana really cannot switch crops, and the only agricultural business that is doing well is raising cattle,” Whatley said. “It’s great for those in the cattle industry, but it’s an expensive business to get into.”
Karen McClelland said her father, who is a rice farmer, would not switch crops even if he could.
“My daddy has been a rice farmer all of his life,” McClelland said. “He certainly doesn’t want to change now.”
David Habetz, president of the Calcasieu-Cameron Parish Rice Growers Assoc., said other farmers are wondering why they continue to grow rice at all.
“If it stays like this, we don’t know what other alternatives we have,” Habetz said. “Something has to change.”