Sunday, 27 May 2018

Why is ROCE often higher than ROE?

1 Answer

ROE is Net Earnings over Shareholders Equity. ROCE is Earnings before Interest and Tax over Capital Employed (Shareholders Equity plus Debt financing). Consider a zero debt situation. In this case the numerator of ROE has tax removed (and there is no interest) but the denominator will be the same (no debt) so the ROCE will be bigger. This situation persists until the amount of debt proportionally exceeds the addition of tax and interest to the numerator. My guess is this is the answer to your question in most cases.
The other possibility for a higher ROCE is where a company has a lot of cash and eliminates that from the denominator for the ROCE calculations because the cash is not financing the business, i.e. it is not employed. It is sitting in the he bank. However you can’t remove cash from an Equity calculation. It’s an important part of the equity of a business.
I would view ROCE as an indicator of the business performance where as ROE is a an indicator of the investment performance. So two businesses that are both performing to the same level may be more or less attractive to an investor based on the amount of cash or debt employed. It’s not as simple as saying that more debt is better for investors however. Debt adds risk to liquidity and cash adds opportunity (for acquisitions etc..).

Monday, 21 May 2018

The Bad Modern History of Farming

Agriculture suicides in Australia - A Booming Economy With a Tragic Price

REGIONAL AUSTRALIA, PART 1 OF 2


Australia is a breadbasket to the world and a globalization success story. So why are its farmers killing themselves?
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The grave of James Guy at a cemetery in the Australian state of Victoria. Mr. Guy hanged himself on the dairy farm that he owned with his wife, Mary.CreditAdam Ferguson for The New York Times
By Jacqueline Williams
SIMPSON, Australia — James Guy had been a dairy farmer since he was 15, and at 55, he thought he’d be preparing for retirement. Instead, he struggled to make the payments on a bank loan after the price of milk fell and never recovered.
One night in November 2016, his wife, Mary, who was working part-time as a nurse to help make ends meet, came home to find he had hanged himself.
“When a farmer is looking down the barrel of having to sell his farm or lose his farm or give up the profession he’d done all his life, it’s devastating,” Ms. Guy said, her voice wavering, from her farmhouse in Simpson, a town in Australia’s dairy heartland of Victoria. “They just lose their identity.”
Family farms like Mr. Guy’s have been the producers of Australia’s agricultural bounty, and the bedrock of its self-image as a nation of proudly self-reliant types, carving a living from a vast continent. But as Australia’s rural economy has boomed on the back of growing exports, small farmers have not always shared in the bounty, with many forced into borrowing money or selling their farms.
The emotional cost of these losses has become visible in a slowly unfolding mental health crisis in rural regions, seen most tragically in a rising number of suicides.
[One rural town found success by welcoming immigrants. Read our second story on regional Australia tomorrow at nytimes.com/au.]
Nationwide, people living in remote Australia now take their own lives at twice the rate of those in the city: Every year, there are about 20 suicide deaths per 100,000 people in isolated rural areas, compared with 10 in urban communities, according to independent studies of local health figures.
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Jim Whelan, a cattle farmer, at his mother’s property near Charters Towers, in northern Queensland, Australia. Mr. Whelan has struggled with depression and the difficulties of farming through drought. His son, also a farmer, killed himself in 2013.CreditAdam Ferguson for The New York Times
In very remote parts of the country, the figure is closer to 23, the studies say.
The horrific potential of this mental health crisis burst into public view this month in the tiny town of Osmington, south of Perth, where a grandfather is believed to have killed six members of his family and then himself after they reportedly fell into economic difficulties.
But most of the tragedies involve someone quietly taking his own life. Research shows that farmers are among those at the highest risk of suicide.
In the state of Queensland, studies have shown that farmers are more than twice as likely as the general population to take their own lives. In remote parts of the state, the suicide rate for farmers was up to five times that of nonfarmers.
“There’s a mental health crisis in rural Australia,” said Hugh van Cuylenburg, the founding director of the Resilience Project, an organization that promotes mental health across Australia. He added that it had reached “epidemic proportions.”
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“There’s a mental health crisis in rural Australia”
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The problem of rural suicides is not unique to Australia. Countries as diverse as India and France also face problems of farmers killing themselves. In the United States, suicides have been increasing since 1999, as an opioid epidemic has also disproportionately struck poor and rural areas.
But in Australia, the crisis seems to be worsening at a time when, at least on paper, the rural economy is quite robust.
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Residents of Clermont, Australia, at a men-only gathering in October to discuss suicide and mental health problems in rural communities. The vast majority of rural Australians who take their own lives are men.CreditDavid Maurice Smith for The New York Times
It is also an epidemic that few Australians fully recognize, even in rural areas.
Experts say social stigmas prevent many people from talking about mental or emotional difficulties. This is particularly true in rural Australia, where the majority of farmers are men, who are expected to display an image of rugged individualism.
Men represent the vast majority of rural Australians who kill themselves. according to experts.
The problem is compounded by the difficulty of getting help. With just a small number of mental health centers and trained professionals scattered across Australia’s vast rural areas, residents are only able to access mental health services at a fifth of the rate of city dwellers, according to a 2015 report by the Center for International Economics in Canberra.
Mr. Cuylenburg of the Resilience Project, who travels around Australia giving talks on ways to improve mental health, says he finds the biggest need in rural areas.
On a recent trip to Clermont — a remote town of about 2,000 people that’s an 11-hour drive north of the city of Brisbane — he said hundreds of people showed up to hear him speak. Many came up afterward to share their stories about suicide attempts, their own or those of friends.
“There are always issues around mental health everywhere I go,” Mr. Cuylenburg said. “No one talks more about suicide, no one seems to be more affected by the numbers of suicide, than in the rural parts of Australia.”
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Andrew Fernie on his farm outside of Clermont. Mr. Fernie has suffered for years from depression and other health issues, for which he has been treated with medication and therapy.CreditDavid Maurice Smith for The New York Times
The problem has become so severe that rural communities have gone on suicide watch. In some towns, residents have compiled lists of warning signs such as sudden withdrawal from society.
Despite such community-based steps, many cases require professional care.
“If prevention and treatment services got to them earlier we’d see less deaths,” said Martin Laverty, chief executive of the Royal Flying Doctor Service, one government-backed effort to improve access to health care in rural areas.
The service relies on small planes to cover some three million square miles of the most rural parts of Australia, flying in doctors and other professionals who offer basic and emergency care.

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“If prevention and treatment services got to them earlier we’d see less deaths”
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But Mr. Laverty said the service is spread too thin. Last year, it provided almost 25,000 people with mental health counseling.
New federal funding will allow it to triple that number next year, a sign of how dire the situation has become. But Mr. Laverty said even that will barely scratch the surface of the problem.
“There’s no more important topic,” Mr. Laverty said. “We need to make city folk aware that the food bowl of Australia — the area in which our crops are grown, and our milk and meat is provided — needs their support.”
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Dairy farmer Phil Vines milks cattle on a farm near Simpson, Australia. Mr. Vines rents the farm from Ms. Guy, whose husband hanged himself after milk prices dropped. The low prices also prevent Mr. Vines from turning a profit.CreditAdam Ferguson for The New York Times
The causes of rural Australia’s crisis vary. Some farming areas have been pummeled by drought, which many blame on global warming. Other communities, like Pyramid Hill, Victoria, have desperately needed workers and are turning to immigrants for help.
But economists and mental health experts say a common thread is the changes unleashed by a globalizing economy.
There is a painful irony here, they say, since Australia has embraced free trade in farm goods, and even pressed other nations to liberalize their markets, in the belief that agriculture is one of its most competitive industries.
And Australian farm exports are growing: Last year, they totaled 44.8 billion Australian dollars, or $33.5 billion, up more than a fifth from just six years earlier, according to the National Farmers Federation.
But many experts say the biggest beneficiaries are larger corporate farms. Family farms are less able to ride out fluctuations in far-flung global markets that can drive down prices of their crops while raising the cost of tractor fuel.
Brian Sporne, a cattle farmer in Clermont, said people in the area had been working themselves “into a frazzle.”
“Everything is so competitive now,” said Mr. Sporne, a strong man with worn hands who raises his herd on a dry landscape of low scrubs and sandy orange earth. Mr. Sporne said he himself has suffered from depression. “Everything’s more expensive — land’s more expensive, then you’ve got to have bigger debt.”
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“This is happening to more and more people, and it’s not their fault,” said Mary Guy, who still lives on the property where her husband took his life. CreditAdam Ferguson for The New York Times
Farms are forced into debt to make ends meet. Across Australia, total borrowing from banks by farmers has ballooned to about 70 billion Australian dollars, or about $53 billion, seven times the level in the early 1990s, according to the Australian Farm Institute.
When they can no longer make the payments, many farmers go bankrupt. Across Australia, the total number of farmers declined by about 40 percent over the 30-year period ending in 2011 — a loss, on average, of 294 farmers every month.
Losing a farm is more than just losing a place of work. The properties are also homes that have been in families for generations.
Farmers speak of losing their sense of purpose, even their will to live.
Faced with the prospect of losing his farm, something inside James Guy simply broke, his widow said.
“This is happening to more and more people and it’s not their fault,” said Ms. Guy, who now rents out part of the farm but still lives on the property. “People are slowly disappearing because we’re being squeezed out.”
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“Everything’s more expensive — land’s more expensive, then you’ve got to have bigger debt,” said Brian Sporne, a Clermont cattle farmer. People have been working themselves “into a frazzle,” he said.CreditAdam Ferguson for The New York Times
Martozer commented May 21
Martozer
Brookline
Why is this being called a mental health crisis? This is a response to economic conditions and the tragic effects of capitalism.
Commoner commented May 21
Commoner
By the Wayside
There is more here than what is described in this article. The story of individual pathology and its treatment leaves aside the bigger issue of how the deterioration of what it means to be human continues in the pursuit of profit. No one person can understand, let alone fight against, the trends which are causing the increase in the number of deaths of despair of all types and across most all communities.The suicides, the overdoses, the gun violence and the shortened lifespans which I read about almost daily in the US press are symptoms of a condition which has no name or treatment. The head in the sand approach is only going to prolong the agony that has been going on for years. Much has been written about the good that capitalism has done by lifting billions out of poverty, little has been said about how it has destroyed lives at the same time. Some honesty on the diminished prospects of the working classes along with ameliorating policies could have cushioned the wrecking-ball of unfettered globalization. A painful chapter in history is the best I can hope for, the worst I fear is the destruction of the environment and the end of the human race as I have known it. The next iteration of humanity will be better, perhaps, too bad I won't get to see it.
Mark commented May 21
Mark
Perth Australia
The European Union use an environmental management framework called Pressure-State-Response. It is very useful in attempting to sustain all aspects of our community; Environmental, Social and Economic aspects. In Australia climate change impacts have been measurable since 1975. Changes in the state of our climate over this period of time have created pressure at all levels of society. Our response is non-existent and our acknowledgement of the root-cause of the problem by our leadership is almost fraudulent.
Larry Dickman commented May 21
Larry Dickman
Des Moines, IA
There is a battle being fought globally today.

On one side is big agribusiness: get big or get out. On the other side are the voices in support of sustainable agricultural practices.

Global warming brought on by climate change exacerbates the conflict by reducing the amount of water available for irrigation and by increasing the severity of storms and droughts.
Commoner commented May 21
Commoner
By the Wayside
There is more here than what is described in this article. The story of individual pathology and its treatment leaves aside the bigger issue of how the deterioration of what it means to be human continues in the pursuit of profit. No one person can understand, let alone fight against, the trends which are causing the increase in the number of deaths of despair of all types and across most all communities.The suicides, the overdoses, the gun violence and the shortened lifespans which I read about almost daily in the US press are symptoms of a condition which has no name or treatment. The head in the sand approach is only going to prolong the agony that has been going on for years. Much has been written about the good that capitalism has done by lifting billions out of poverty, little has been said about how it has destroyed lives at the same time. Some honesty on the diminished prospects of the working classes along with ameliorating policies could have cushioned the wrecking-ball of unfettered globalization. A painful chapter in history is the best I can hope for, the worst I fear is the destruction of the environment and the end of the human race as I have known it. The next iteration of humanity will be better, perhaps, too bad I won't get to see it.
Larry Dickman commented May 21
Larry Dickman
Des Moines, IA
There is a battle being fought globally today.

On one side is big agribusiness: get big or get out. On the other side are the voices in support of sustainable agricultural practices.

Global warming brought on by climate change exacerbates the conflict by reducing the amount of water available for irrigation and by increasing the severity of storms and droughts.
paulie commented May 21
paulie
earth
Isn't it nice to know that if you're a huge corporate farm the government will be there to endure you make a profit but if you're a little guy paying taxes you're on your own?
Philip Holt commented May 21
Philip Holt
Ann Arbor, Michigan
I've lived for 30 years in Wyoming, a state with little farming and fewer ranchers and cowboys than you might expect. It also has one of the highest suicide rates in the U.S. The issue isn't so much agriculture as social isolation. People live in small communities (the largest town is 60,000), often with a narrow circle of acquaintance and a shortage of things to do to feel better. Add to that an expectation that you solve your problems on your own (as in Australia), awful winters, and a lot of alcohol and firearms about, and people kill themselves. Rural environments are probably rough on mental health all over.
Julie R commented May 21
Julie R
Washington/Michigan
The plight of the family farmer is the same in the US as other parts of the world where Agra businesses are proliferating. My son-in-law took over the family dairy farm he'd worked all his life. Whether it was the price of fuel and fertilizer, bad weather, breaking equipment, high lease prices on land, the turnover of employees or milk prices at the bottom, it was all a recipe for overwhelming stress. Add to that the fear of failing the family by giving up and it was a pressure cooker. He was miserable, angry, sleep deprived and at least once suggested he'd be better off dead. Our side of the family spent five years talking to him, supporting him, getting him therapy and then waiting for him to come to terms with the fact that it was the farm or him, the two could not co-exist. He finally liquidated and left. He got a good paying job with regular work hours. I've never seen him happier. But the ending is not all good. His family has shunned him since he left the farm. No one has spoken to him in two years and most of them live within five miles. They have no idea what he went through to deal with the guilt of it all. even when it was destroying him. And they continue to punish him for the selfish decision of choosing to survive.
GWBear commented May 21
GWBear
Florida
I would gladly pay a bit more for milk and cheese so some poor guy can turn a profit, feel some hope and dignity, and not feel the need to take their own life. Put it right on the price tag on the supermarket shelf! Let people know they are helping those that grew their food...

There is so much more to life than making all the prices as low as possible! We can and should do more.
nathanlarry commented May 21
nathanlarry
Winnipeg Canada
You mentioned several countries with similar problems but did not mention Canada. Why? Farm Marketing Boards. The big business model that the USA follows hates them. It wants the product as cheaply as possible, even if it means the producer goes broke providing the product. But once American farmers find out how they work, they wish they had them in the USA. How do they work? Very simply, they set quotas on much or how many of a farm item can be produced for the market. If the board finds that not enough is being produced, they can then raise the quota for each farm based on what it is already producing. Or the opposite can be true too. They also set the price of the product that the farmer gets, that price is based on the inputs required to get it to market and for the farmer's income to be good enough to make a living.
In NAFTA negotiations going on now, this is one item the Americans wanted remove and I believe the vast majority of Canadians would not want that. And Canadian government negotiators have remained steadfastly against the American big business desires on this issue. In this case people come before big business.
Mark commented May 21
Mark
Perth Australia
The European Union use an environmental management framework called Pressure-State-Response. It is very useful in attempting to sustain all aspects of our community; Environmental, Social and Economic aspects. In Australia climate change impacts have been measurable since 1975. Changes in the state of our climate over this period of time have created pressure at all levels of society. Our response is non-existent and our acknowledgement of the root-cause of the problem by our leadership is almost fraudulent.
chris commented May 21
chris
queens
Destroy the conditions for a viable rural economy through agribusiness biased policies +

Equate agribusiness with rural economy (NY Times I'm looking at you) +

Deluge rural communities with propaganda telling them the rural economy is great (NY Times still looking at you) +

Blame small farmers personally for the failure of the state to privilege livelihoods over shareholder profits =

Farmer suicide.

It's a well known issue and while mental health services are of course important, in this context they're the definition of a band-aid, not a cure.
Taveuni Waka commented May 21
Taveuni Waka
Long Island
Once again, people reacting to economic and social forces with despair and being labeled ‘mentally ill’. Last time I checked despair is a typical human reaction to despairing circumstances where one can’t ameliorate his condition under his own power and help isn’t coming from others. Capitalism and its mental health professional arbiters of what is normal and abnormal to feel have decided these people are ‘ill’ not just reacting to being crushed under the heel of power. It clouds the picture of what is actually going on, protects the powerful from any responsibility for making these people despair and frankly insults people who are actually struggling with illness.

Tolstoy’s happiest years were actually spent out in the fields, doing manual labor. But also remember this was towards the end of his life when he had embraced Christian Anarchy, had turned away from a society he saw as corrupt, wicked and hypocritical and tried to live a simpler life tied closely to following the Golden Rule and the teachings of the Sermon on the Mount.(and became a vegetarian for ethical reasons). He wasn’t trying to live the rural life of these poor Australian suicide cases, living a life as a cog in a vast, heartless, global machine of capital where the farmers are treated just slightly better than their animals bound for slaughter.

Turn your back on ‘mental health’ and capitalism and other isms. Love your neighbor as yourself. Treat animals kindly.
Jill Reddan commented May 21
Jill Reddan
Qld, Australia
This article focuses on the concept of depression, or more accurately despair, as being about individual pathology and that is true, but only in part. Repeated studies, over time, have shown that economic conditions significantly influence suicide rates. Now we also see that other influences on the economy, such as global warming, will also influence suicide rates.
The approach to reducing suicide has to include economic relief as well as treatment being available in isolated areas. And it must include reducing the access to means and that means firearm control too.
Abdul Abdi commented May 21
Abdul Abdi
Apex, NC
I could be mistaken, if my memory fails me, but I remember farmers in the United States went through similar crisis in the 1980 when huge agricultural companies competed with and defeated small scale farmers. Many of them went into debt to stay in business and when the banks began foreclosures, there were similar reports of farmers killing themselves because they were losing a way of life. I don’t think anybody came to their aid because people were enjoying cheaper farm products. I hope policy makers in Australia take a different route and do something to help the family farm. But I am not sure the government will help because farmers , like huge agricultural firms, need a powerful lobby group and small farmers don’t have the money to hire them. It is a sad story indeed because my grandfather was a small farmer in East Africa and I remember he was always at the mercy of forces beyond his control...
Thomas Zaslavsky commented May 21
Thomas Zaslavsky
Binghamton, N.Y.
In the U.S. there is a similar crisis, much ignored. Federal farm policy has supported larger farms, especially huge farms, by allowing them to benefit from subsidies that were meant to keep small farmers in financial health. Giant, oligopolist agribusiness controls prices so they can extract the profit that individual farmers need to keep their farms alive.
Lowly Pheasant commented May 21
Lowly Pheasant
United Kingdom
It should be farmers that own land, not vast corporations, not wealthy landowners. Corporate agriculture has produced food that makes people ill, devastated soils and ecosystems and driven the farm prices so low that the countrysides of many countries are riven by the tragedy of economic deprivation and farmer suicides. When farmers own land, and are able to buy it at reasonable values, they can invest in it over the long term. They can improve drainage, increase manurial values, and organic matter, all the things that are now seen to be vital to the long-term health and fertility of soil, without which enormous famine would strike the world. And perhaps if there were fewer corporations then prices might be driven up enough that farmers could gain fair reward for their immense labour. In a related issue - the USA should be ashamed of the amount of farm accidents that affect children. This is because of the stranglehold of prices that mean small family farms can't afford to hire staff - using their own children instead to carry out adult jobs.
Spud Murphy commented May 21
Spud Murphy
Earth
There are many reasons for increased suicide rates in rural areas, including those mentioned here already. But there are a few other issues that are generally not recognised or understood.

For example, many farmers subconsciously know that farming animals is both ethically wrong and environmentally damaging. Day in, day out, looking after animals you know you are soon going to send off to their deaths has to take a toll on anyone with any form of conscience. They won't admit as such, but when you bring up such issues, the reactions you get are purely defensive, they know there's truth to it but to admit it to themselves means admitting their life's work has been to cause cruelty and environmental destruction. Of course, there are those that have no concept of these issues and they feel no guilt, but there are those that do.

Some farmers manage to get out of the animal industry and change to growing crops, be it grains, veggies or whatever. Talk to those farmers, and they will say they are much happier for it.

However, farms that have run livestock for extended periods are generally very degraded, and a lot of soil rejuvenation must be done. Long-term livestock paddocks can usually grow grass and weeds, but not a lot else (we live in rural tassie on ex-livestock farmland, and the soil is stuffed, it takes a lot of work to get things to grow), except maybe hemp or similar, which has only just become a legal food crop in Oz.
Paul Dobbs commented May 21
Paul Dobbs
Cornville, AZ
American Wendell Berry aptly described this very problem in his 1977 book The Unsettling of America: Culture and Agriculture. The evidence and arguments are complex, but the takeaway is simply that agriculture and land are too important to human survival to be left to the blunt instruments of economics and business. You can listen to American farmers and Berry explain the situation by watching the new film "Look and See: A Portrait of Wendell Berry" on Netflix or PBShttp://www.pbs.org/independentlens/films/look-see-wendell-berrys-kentucky/
memsomerville commented May 21
memsomerville
Somerville MA
I hear from a lot of farmers that the carping by the foodies isn't helping. Did you see the T-shirt that Sonny Perdue held up in his tweet the other day?

Stop blaming farmers for your flawed understanding of farming and food production. It's not the same as your backyard organic garden and you don't know better than they do.
BCB commented 10 hours ago
BCB
Melbourne, Australia
Something this article does not cover is the extensive regulatory schemes facing farmers that exist in Australia, especially in Victoria. Like with most regulation, the large companies are able to bare the cost and burden of compliance and failure of compliance. Water use restrictions, land use restrictions, unionized fire brigades, taxes, liability for milk buyer's truckers, excessive minimum wage and weekend rates, and on and on. And as the majority of people are in the cities, these rural issues become farther and farther from the understanding of the masses and decision makers.
Trebor commented 9 hours ago
Trebor
USA
The demise of small farms stems from the same forces that are shrinking the number small independent businesses everywhere. Corporate power (financial and governmental) and the corresponding mindset and drive toward monopoly.
Food production is too important to be organized around corporate profit. Corporate profit is nearly the antithesis of the sensible values society should share around food production. (similarly with health care) For food production, sustainability in all its areas of meaning has to be the watchword. Large scale corporate "food production" approaches could be leading us to a collapse of the food supply.

Artificial scarcity and disconnection from the land in the first world has created the drive and the need among most people for cheap food rather than good food. Cheap food produced in the corporate model relies on externalities that a more connected (to nature) and aware society would not accept. Our values.. allowing the reality of scarcity (poverty in the US) and the fear of scarcity to exist in what are nominally extremely wealthy countries and the nonproducing owner class to continue to create this poverty, must change.
Thomas Zaslavsky commented May 21
Thomas Zaslavsky
Binghamton, N.Y.
The government of Australia has cut back on scientific support, including the climate monitoring system. What is wrong with them?
Agnes commented 9 hours ago
Agnes
San Diego
"farming animals is both ethically wrong and environmentally damaging. Day in, day out, looking after animals you know you are soon going to send off to their deaths has to take a toll on anyone with any form of conscience. "
This statement is judgmental and insulting to farmers who are struggling to stay afloat. Farmers/ranchers provide us affordable food as in grain, meat and dairy products. And, as consumers of farm products, we eat them without feeling guilty, and worse yet we often discard uneaten food into the trash without ever considering that an animal had been sacrificed and that farmers had labored long and hard to get to the market. Instead, you projected an assumed guilt to be the reason for increase in suicides amongst farmers. This statement represents the arrogance and ignorance of one city dweller, fortunately.

Farmers face many financial hurdles, living a hard live, working long hours from dawn to dusk. I hope governments in Australia as well as US will provide low interest loan to farmers to enable them to navigate the changing markets and economic factors of farming.
Paul Dobbs commented May 21
Paul Dobbs
Cornville, AZ
From Wendell Berry's essay The Bad Modern History of Farming in the June 2017 Progressive:

"The land-using occupations, then, are of primary importance, but they are also the most vulnerable. We must notice, to begin with, that almost nobody in the supposedly “higher” occupational and social strata has ever recognized the estimable care, intelligence, knowledge, and artistry required to use the land without degrading or destroying it. Farmers may be the last minority that even liberals freely stereotype and insult. If farmers live and work in an economic squeeze between inflated purchases and depressed sales, if their earnings are severely depressed by surplus production, if they are priced out of the land market, it is assumed that they deserve no better. Their success is their ability to produce too much, which amounts to a kind of failure."
The essay is available online at http://progressive.org/magazine/the-bad-modern-history-of-farming/
Mark Crozier commented 8 hours ago
Mark Crozier
Free world
Problem is, would the higher prices benefit the farmer, or the supermarket/middle man? There are many layers between the farmer and the consumer, each taking a slice. The example of coffee beans that are grown in 3rd world countries and then eventually sold for an astronomical amount per cup in Starbucks is a well-known illustration of this problem.
Thinking commented May 21
Thinking
This is such a sad situation all around. I feel so sorry for the animals being raised on the farms. It is probably worse for the animals at the massive farms.
Humanity is focused on itself, so self involved that we are missing the important thing, that we need to give back and be caretakers of the earth and the other beings on it. These men in the photo look so tired, so overworked, so worried. They probably are involved in farming practices that I personally would completely object to as being cruel, still I feel so sorry for them. We are supposed to be so smart, the smartest beings on the planet, why are we so disappointingly self centered and unaware of the ramifications of our actions?
MS commented May 21
MS
Midwest
So like the large companies force smaller business to close the large farms are doing the same thing to smaller farms.

I would bet the same thing is happening in the US without being recognized. The lack of labor to pick crops due to the administration's hatred of non-white immigrants is going to make it worse...

On farms a rifle is basically another piece of farm equipment (unlike weapons used in the epidemic of mass shootings).
Kelly Logan commented 11 hours ago
Kelly Logan
Winnipeg
Funny, I was thinking the same thing. However, while the federal government today supports some marketing boards (dairy), it hasn't always. The loss of the Canadian Wheat Board changed many things here on the Prairies. We're no longer "the bread basket of the world," there's more money and stability in canola and soy beans.
Tom commented 6 hours ago
Tom
Upstate NY
We measure the cost of the efficiencies of capitalist societies. Like measuring the health of the economy by the stock market, we let the "winners" define success on their terms and we mindlessly follow along. The problem is perhaps less that the big dogs do this, and more our lazy compliance.

Many towns see family businesses as well shuttering storefronts, also part of generations of a family. Like rats in a Skinner box, we are conditioned to celebrate low prices, which also deflate the value of labor. Prosperity is no longer shared. Lower prices lead the way in a downward spiral for workers who no longer thrive as they did 60 years ago, but hang on instead. Sorry farmers, but you have chosen to victimize yourselves as unique to the point that you no longer see what you have in common with other displaced people. Monsanto has much in common with Walmart and the big box stores, many now suffering in abandoned malls after devastating Main Street, by Amazon. The next wave of heartless efficiency. The economic hunters become the hunted. Yet we still can't help but look at stock prices and profitability as the sole measure of success.

Long before its embrace of labor unions, which it helped to create, the New Deal got its support from red state farmers. With fewer farms, farmers need to find allies elsewhere. Maybe it is time to give up rugged individualism and accept there is no refuge from capitalists who prize profit and efficiency over the human cost paid by the 99%.
Dan Leyden commented 10 hours ago
Dan Leyden
Portland
The Canadian Wheat Board created a govt export/monopoly/subsidy that protected Canadian farmers and gave them an unfair advantage over lower cost foreign competition in the global market.
Ag or farm boards may be great in a domestic market but they create trade conflict when those domestic farmers they protect export their commodities. I believe countries go to war in many facets over these type of issues. One person’s govt boost may come at the expense of another’s knock down.
Mark commented May 21
Mark
Wonder what the stats are here in the US?
Beaconps commented 5 hours ago
Beaconps
Thoreau mentioned the disadvantage of inheriting the family farm which doomed the recipient to a hard life akin to pushing a barn down the road. It was tongue in cheek but in a ways, accurate. The farm I worked on stayed in business because they diversified, half dairy (100 head) and half fruit (apples). We as a people have grown distant from the production of food and a badly managed farm program is as damaging as a badly managed farm. As Berry points out, industrial production, financial "production", and agricultural production are based on different economic principles and planning, if the goal is choice and sustainability. Farms are neither banks nor factories. Farmers are craftsmen in a world of disposable, mobile, interchangeable parts in a distributed, global, workforce.
matty commented 5 hours ago
matty
boston ma
"But many experts say the biggest beneficiaries are larger corporate farms. Family farms are less able to ride out fluctuations in far-flung global markets that can drive down prices of their crops while raising the cost of tractor fuel."

The above NEGLECTED to mention that corporate farms have OVERPRODUCED and created the glut in the first place. That's what drove down prices, not any far-flung "global" market price fluctuation. Overproduction will cause the price of any commodity to plummet. Small farms as a rule do not overproduce, partly because they can't, and partly because they realize the ramifications of overproduction. Corporate farms don't give a hoot. They're sitting on corporate billions anyway, so what if a percentage of their production spoils and needs to be tossed. They've already accounted for that. Small farms can't afford to do that. Food production is, in certain ways, bad enough with the pollution it creates, but with corporate factory farms, it's 100 times worse, not only with the pollution it creates but the overproduction as a result that never gets consumed and the needless destruction of the environment and small farmers lives and livelyhoods left in its wake.
Economy Biscuits commented 6 hours ago
Economy Biscuits
Okay Corral, aka America
Life is rough stuff for most people everywhere and always. It usually doesn't get reported in national news sources and people suffer alone. You need a modicum of good luck to come out the other end, relatively unscathed. I think the stoics had a handle on it. Read Marcus Aurelius and Epictetus and things come into greater perspective. Both my wife and I have had/have major illnesses but lead a pretty good life...always thinking about what we have rather than what we don't have. Perspective.
Thomas Zaslavsky commented May 21
Thomas Zaslavsky
Binghamton, N.Y.
Bing as usual doesn't understand the issues, which the article makes clear enough to me.