Fuel, Food Demand Raise Corn, Soybean Prices
LYNN NEARY, host:
For some farmers these are the best of times, or nearly so. Alternative fuels are creating higher demand for corn and world food demand has wheat and soybean prices way up. It wasn't long ago that farm country was full of hard-luck stories.
We called one corn and soybean farmer, Charles Speiker, in New Hampton, Iowa, to see whether things are turning around.
Mr. CHARLES SPEIKER (Corn and Soybean Farmer): Oh yes. It's the first time it's been looking this good for us. But it's a bubble I feel that won't last forever.
NEARY: You're not trusting it then, you're saying.
Mr. SPEIKER: I think the whole thing driving this thing is energy. Everything we do in farming and in this county has to do with energy. Everything we get -toilet paper, bananas, fertilizer, corn, all that stuff - has to be moved by semis and that all costs money.
NEARY: Now, I understand you have two sons working with you. Is that right?
Mr. SPEIKER: Well, we're kind of we work together but they each got their individual operation.
NEARY: Because there was a time when, I think, a lot of people were leaving farming and maybe the sons of farmers were heading off looking for other work because it was so tough to farm. Are we seeing a reversal of that trend?
Mr. SPEIKER: Well, I wouldn't say it's a trend right now. Maybe it will be. There's a lot of people who want to maybe come back. But for a young man to get started farming now is almost impossible unless he has a relation or somebody to help him get started back in, like I'm doing with my boys.
NEARY: So, even with getting better prices on your crops it's still not easy, it sounds like, down on the farm.
Mr. SPEIKER: The reason we're getting better money for our crops is the world has exploded and there's more demands. And right now we're running a little short. Ethanol has something to do with it but not the whole thing.
China is really coming on to be a strength in the world. India is also coming on - they're buying a lot of fertilizer and trying to raise better products for their people. Speculators are driving this - right now, I feel, corn is way higher than it should be. Same way with soybeans, and it's having to do with fear. And in another year we could see this turn and go too far the other direction too. And it always will. There's nothing go straight up.
NEARY: So you don't really know how long this bubble might last.
Mr. SPEIKER: We've got this year, should be all right; next year should be questioned; '10 we could be in trouble. If they drive this corn too high, we're going to lose our demand worldwide and we take away the demand and then pretty soon you've got a surplus. It's just a vicious cycle like.
NEARY: Charles Speiker is a farmer in New Hampton, Iowa. Mr. Speiker, thanks so much for talking with us.
Mr. SPEIKER: All righty.
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