We're facing a credit crisis because financial institutions have no confidence that the federal government will provide supplemental funding, said Terpstra. This sends a clear signal that supplemental funding is available for the current crop year. Gary Sebree, a rice farmer in Stuttgart, Ark., said the next step in battling the credit crisis is to make sure supplemental funding is enough to offset low rice prices and high production expenses. Congress has taken an important first step, but we now have to make sure the level of funding is adequate for this year. We have a bad combination of extremely low commodity prices coupled with high production expenses, said Sebree, who serves as chairman of the U.S. Rice Producers Group.
Rice prices are currently at an eight-year low and rice exports are down.
Growers want Congress to review trade sanctions reform to open up markets such as Cuba and Iran. Meanwhile, fuel and fertilizer costs have nearly doubled over the past two years. Without adequate supplemental funding from Washington, growers will face a negative cash flow situation for fourth consecutive year. As an industry we have to make sure funds are channeled to meet the needs of rice farmers, said Sebree. Other commodity groups are facing difficult issues, too.