It’s been a tough year for everyone, but if you are reading this, then you made it to the end. We’re glad you are here. Take a breath. Unclench your jaw. Relax your shoulders.
Now let’s take a look back at the stories that shaped agriculture in 2022, so we can look forward toward the new year.
Russia, Ukraine and inflation
Those three words pretty much sum it up. Inflation was on the horizon as 2022 began. Then, Russia launched a ground invasion of Ukraine in February, throwing global supply chains for food and energy into turmoil.
Many people found out this year that Ukraine is a major global producer of several agricultural commodities, including sunflower oil, wheat and corn. That region of the world around the Black Sea has been called the world’s bread basket as it supplies grains and seed oils to parts of Europe, Africa and Asia.
Russia is also a major exporter of grains, as well as crude oil and natural gas, which powers much of Europe. In reaction to the war, the U.S. and the European Union imposed a number of sanctions against Russia. This included an effort from EU countries to cut their dependence on Russian fossil fuels.
While much of this hasn’t directly impacted the U.S., meaning we haven’t seen food or energy shortages other nations have, we are connected to the global economy. The Russia-Ukraine war didn’t cause inflation, but it didn’t help things, either.
Supply chain issues, pent-up consumer demand and federal stimulus checks leftover from the pandemic pushed prices up. The Federal Reserve has been bumping up interest rates throughout the year to cool down the economy, without much success.
The cost of everything has gone up. Nationally, food prices rose more than 10% over the past year, according to the Consumer Price Index. Energy prices rose 13% in the past 12 months. Prices for everything else rose 6% in the last year.
Making matters worse, an outbreak of a highly pathogenic avian influenza, or bird flu, killed more than 57 million birds across the country, bumping up the price of eggs to over $5 per dozen. A dozen eggs cost about $1.50 this time last year.
One commercial egg laying farm in Ohio was hit by the virus, killing 3.7 million birds. Pennsylvania lost more than 4 million birds to the flu, hitting 25 commercial flocks mostly in the southern part of the state. West Virginia has so far been unaffected by the virus.
While fuel prices are coming back down, they too hit an all-time high in the summer. Gas was over $5 per gallon in June and diesel was over $6 per gallon in Ohio, according to AAA. The price of fertilizer was also sky-high.
Corn, soybean and wheat prices were up, too. Corn futures topped $8 per bushel in the spring, soybean futures were up to nearly $17 per bushel and wheat was over $11 per bushel. Cash prices remained throughout harvest, with corn over $6 per bushel and soybeans over $14 per bushel as of press time. This has been a good thing for farmers, but didn’t matter much when the costs of doing business were up.
Shifts in power
Midterm elections were held in November, resulting in a split Congress. Democrats held onto power in the Senate, and increased their numbers by one seat, but lost the House of Representatives.
At the state level, Ohio voted to keep Republican Gov. Mike DeWine at the helm. Pennsylvania voted in the state’s attorney general, Josh Shapiro, a Democrat, to replace Tom Wolf as governor. Under the Wolf administration, Pennsylvania invested heavily in agricultural programs through the first-ever state-level Farm Bill. Time will tell if Gov.-elect Shapiro feels as strongly about the state’s largest industry.
Leadership of the state’s agriculture departments is up in the air. Dorothy Pelanda is quietly retiring as the director of the Ohio Department of Agriculture on Dec. 31. There was no public announcement that she was stepping down from her role. Her successor has not yet been announced.
Pelanda is Ohio’s first female director of agriculture. She was nominated by DeWine and took office in January 2019. Under her leadership, the department launched the lofty H2Ohio water quality program, which has invested $172 million in projects to reduce phosphorus runoff from farmland.
It’s unknown if Pennsylvania Secretary of Agriculture Russell Redding will stay on with the new governor. Redding first served under Gov. Ed Rendell from 2009 to 2011. He came back to the position after being nominated by Wolf in 2015.
Looking ahead
The current farm bill expires in 2023. Expect lots of talk about what various groups want to see from the next iteration of the legislation that funds many U.S. Department of Agriculture programs. It’s also a year for data collection of the USDA’s Census of Agriculture, so watch for your paperwork in the mail.
Some other things to keep an eye on in the new year: natural gas production is expected to rise in 2023, according to federal government estimates. Drilling activity is up in the Appalachian basin. The rig count in the Marcellus was at 39, as of Dec. 22. That’s 10 more rigs than this time last year. The Utica had 13 rigs, the highest the rig count has been since 2019.
Solar development has been cruising along seemingly without issues in Ohio until this past fall, when the Ohio Power Siting Board rejected an application to build a utility-scale solar farm for the first time ever. The Birch Solar project, to be built in Allen and Auglaize counties, would have covered 1,400 acres on farmland southwest of Lima, Ohio. Before that, the board had approved more than 30 utility-scale solar projects seemingly without much friction. The board rejected another application in December, the Kingwood Solar project in Greene County.
The board cited overwhelming local opposition to the projects as the reason why it denied both applications.
Neither of these projects was subject to a new law that subjects projects to a public input process. So, does this mean that more local governments and residents are opposed to solar projects? Or that they have figured out how to properly register their opposition? Or does it mean that the power siting board is more receptive to concerns from locals?
(Reporter Rachel Wagoner can be reached at 724-201-1544 or rachel@farmanddairy.com.)
