Cap & Trade - Food Production vs. Forestry

The American Clean Energy and Security Act, already passed by the House of Representatives creates a number of concerns for agriculture as well as rural citizens. This bill, which includes cap and trade provisions, will increase energy costs across the nation. The Obama administration estimates that this legislation could cost households an additional $1761.00 per year. An additional study conducted by the Heritage Foundation indicates that energy costs will increase by more than $1500.00 per year by 2035.

In terms of agriculture, an analysis produced by the USDA indicates that farming will benefit from this legislation. However, we are seeing evidence that this may not be the case. Input costs for farmers will increase, along with energy costs. Granted, some producers may actually benefit from cap and trade, but it is quite possible that the majority will not.

The offsets that will be offered through cap and trade legislation will favor forestry, and this incentive could lead to the removal of millions of acres from food production as farmland is converted to forests. This creates a dilemma for us because the Grange very much supports Forestry as an agricultural enterprise. However, if large numbers of acres are converted to forests, it will lead to less food being produced in the United States. This loss of available acreage combined with the losses that are already occuring as land is being converted to development, will impact all of us in a very undesirable way in the years ahead. Less land means lower production, which will lead to higher food prices, lower exports, and higher imports. Our ability to feed ourselves will diminish. We will be come more dependent upon foreign countries for food. Farmers are already competing for land, and with less land available in the future for production, rental rates will increase. It will become more difficult for agricultural producers to remain in business, which will also impact the supporting agribusiness industry.

Based on the information we have gathered, it appears that this legislation will be detrimental to agriculture. In addition, households will suffer from higher costs. The State Grange is opposing this legislation, and we encourage our members to contact our two Senators and express your opposition to this bill.