Again, everyone, and thanks for joining us for Arkansas Week.

If it's not the perfect storm, it is close to that for Arkansas farmers, though a good rain at the right time would be, as always, welcome.

The prospect of drought, however, is but one of the perils confronting the ag community as the season picks up speed, input costs, fertilizer, machinery, diesel fuel all at forbidding high prices.

While the market for some key commodities is down.

There's additional government aid.

Yeah, but is it enough to keep the Arkansas farm sector on solid soil?

To those matters?

We turn to George Jared of Talk Business and Politics, who covers the Delta scene.

Doctor Hunter Byram, extension economist at the U of A's agriculture division, and drew Flowers of Saint Francis County, farmer who grows a little bit of everything.

Gentlemen, thanks for coming in.

George, let me go to you first.

A perfect storm.

Am I being overly dramatic there?

No you're not.

The community has been suffering for the last several years.

Inflation, higher fertilizer prices, higher fuel prices.

Everything has been coming together.

Low commodity prices for a lot of crops.

You know, this year, you know, we started with Iran that closed the Strait of Hormuz, which everybody I don't think anybody knew what the Strait of Hormuz was before, you know, February 28th.

One third of the world's fertilizer travels through that strait.

Half the arena that's used in the world goes to that strait.

I think 20% of all goes through that straight.

And when it gets shut down, you know, a lot of people make an argument that we don't use all that comes through that straight or a lot of fertilizer comes to that strait.

The problem is, is that China does.

And when 70% of their all is shut down, they're going to go on the international markets and they're going to find all.

And what that does is it raises spikes, oil prices across the board.

And the problem is, is that we've had a war in Ukraine that's lasted over four years.

Most people don't realize this.

The war in Ukraine has lasted longer than we were in World War Two, the United States.

And so what that does is, is and when those prices go up, what happens is you've got these two countries, Russia and Iran, who primarily make their money off of oil.

So when those prices go through the roof, basically there are millions of dollars is flowing into their coffers every single day.

So in effect, we are fueling their war machine, which makes it's kind of like a snowball effect.

So as far as the that aspect of it, it's a real problem.

Would you take issue with any of that?

I do not.

I mean, when we look at just farm income, we're looking at $3.38 billion in net farm income project for 2026 for Arkansas.

All ag crops and livestock.

That's compared to 3.32 billion.

So we're pretty much in a holding pattern at the moment.

And when you look at what's driving that, it's definitely not these crop markets.

It's actually going to be more government assistance is driving this.

So you're looking at about maybe $1 billion in government assistance projected for this year.

That's actually going to keep the ag sector afloat.

And for maybe city folk need to be reminded.

We're talking about a key component of Arkansas's GDP.

Indeed, it's the driver of Arkansas GDP.

Overall, I think it's about 13% of Arkansas GDP or agriculture contributes to 13% of Arkansas.

Drew flowers, you're dealing with this every single day.

Sunday's included.

You're right.

You know you will see the fertilizer prices increase.

They you know there is seasonal rise.

But we're above that, above and beyond that.

Fuel prices, you know, a dollar dollar and a half higher.

And they fluctuate depending on where you go.

You know fuel prices changing by the day.

You know, our input costs are our biggest thing holding us down right now.

You mentioned the government programs they're helping, but they're they're really not enough, you know, to to cover most losses.

If you you've read and you see all of the people talking about the bankruptcies and farms today.

You know, that's on everybody's mind.

That's on my mind every day.

You know, getting through another year.

You know, I'd like to plan for 27 and rotation wise, but you want to you look at this year and you're like, well, what can I plant this year to be profitable for about 2027 next year?

You know, and you're, you're in rice, beans I think cotton a little as I said a little bit of everything.

Yeah.

Just before we begin, I think you told me that in a typical if there is such a thing, a typical calendar year, you're going to use on your, what, 3000, 3000 acre farm you're going to use in the neighborhood of 25,000 gallons of decent.

That's correct.

And now it's a buck and a half or two bucks better higher than it was this time of year ago.

That's right.

Where are you?

Can you cut corners?

How do you do it?

You know, in today's economy, in the past, how close?

How close to the bone are we?

We are.

We are cut to the bone.

We have cut.

We have cut input prices.

As far as you know, we're planning less seed.

And we used to, you know, you know, playing 150,000 seeds to for beans.

We've cut that back to 120.

We're still increasing yield.

We're doing things like that to lower our seed input costs.

That doesn't seem like a whole lot.

But in the scheme of things, across 3000 acres, it's a big difference, but just no small things.

We've cut everything to where we can.

And, you know, University of Arkansas is working on things on the economy side.

They're working on things on the crop input side to try to help us with that also.

But we've cut about all the places that we can cut it.

We've got to figure out a way to lower these input crossed.

Yeah.

George chair back to George Jarrett.

You're all the way from Clay down to Craighead and south of here.

You're covering the Delta farm scene.

Is is Mr.

Flowers situation unique?

No, not at all.

In the last you know, I talked to a lot of farmers.

I've lived in a lot of different places in Northeast Arkansas, and over the last few months I've talked to a bunch of farmers, and every single one of them things are bleak.

I've talked to one farmer that I know very well who was pretty optimistic, but the problem is, is that he owns all of his land.

He didn't have any machinery needs in any time soon.

And so and he had already planned to plant a lot of soybeans in the beginning.

So his plan was ready to go.

And so he's pretty optimistic.

I mean, I don't want to say like optimistic.

He's he thinks he might make a profit this year.

You know.

And that's another thing to Steve is there's another component to this too.

And it's the ag machine market.

And it's a crazy thing.

So farmers have less money to spend on machines.

So they're not buying as many new machines.

So you would think that that would drive prices down because as you have, you know, less customers.

That usually drives prices down.

But the problem is, is that inflation has caused all the raw material inputs into these ag machines to go up significantly.

And so now what happens is, is the machinery costs a whole lot more.

And so what happens is if a farmer needs, you know, a combine or a tractor or whatever, then they're going to go into the secondary market.

And what that does is if you start adding more people into the secondary market, that causes those prices to go up.

So again, it's kind of like the snowballing effect with the Strait of Hormuz.

It's the same effect when you get into the machine market.

Well, it's still on on a matter of diesel.

If my reading is correct, if that and George and Mr.

Flowers, if, if the strait were just suddenly open today, the war was over, there were no more hostilities.

It would still take at a minimum weeks, probably several months for the market conditions in terms of petroleum to return to what was normal.

Yeah, I would agree with that.

And what we saw, at least on the input side of things.

So with fertilizer, we saw this with Ukraine that the prices are pretty sticky is what we would say.

They're very slow to come down.

And so when you look at 2022, fertilizer prices remain elevated above normal for most of that year.

And what we've also seen is since that initial increase in 2022, those average prices have remained the same for the most part since then.

So when you're looking at the increase in fertilizer being something that doesn't quite, it's it doesn't quite want to come down.

That's an issue.

But then again, back to your point about fuel.

Yes, it's going to be sticky, although I don't think it's going to be as sticky as fertilizer prices.

But I mean, it probably will take a few weeks or a month or so for those prices to come down.

Yeah.

That's diesel.

Now there's drought.

Mr.

flowers, could you use a good rain?

Well, I could have.

You used to.

Good rain.

We went from drought.

We were planning corn, you know, 2 or 3in deep.

And then we got 6.5in in a couple of hours.

Ended up with ten inches over that week.

Turn around two weeks later, we get another timing's.

Every timing's everything.

We went from being extremely dry.

Extremely dry.

15 years.

If I've been farming, this dries.

I've ever seen a crop.

Trying to put it in two.

Now we're squeezing in between rains like a normal year.

So has the drought.

We're always a week away from a drought.

We'll say that.

You know, it rained yesterday morning.

I got a phone call about coming here.

I said, yeah, I'll be there by 8:00.

Yesterday afternoon was dry again to work.

We were, you know, planting by 8 p.m.

last night trying to get planters set back and ready to go.

So yeah, the drought was an early issue.

It's still going to be an issue because the subsoil moisture is not there.

But currently we are getting rains in northeast Arkansas.

That's not everywhere.

Overall, Hunter Byrum the the climate arc is a little forbidding right now.

Yeah.

And you know, just to, I guess corroborate what drew is saying here, if you look at the drought monitor, about 54% of Arkansas is either in D3 or D4 drought, which is extreme or exceptional drought.

And when you look at that map even more closely, most of that d4, the exceptionally drought ridden counties are going to be in northeast and southeast Arkansas.

Well, what's going on in northeast and southeast Arkansas are crop production.

Well, we haven't even talked terrace, but we've got a farm bill.

The house has sent a farm bill over to the Senate.

More than ever, AG seems to rely on government assistance.

Yeah.

And one thing that I do want to note is the farm safety net was improved in the Working Families and Tax Cuts Act, or some people known as the One Big Beautiful Bill act last July, but are still some programs need to be in a new farm bill.

And as you noted, the House passed their version, I think, on April the 30th of a vote of 224 to 200 that's now being sent to the Senate.

It looks like the Senate is going to be in session most of June.

And the academy chairman, our senior Senator John Bozeman, is wanting to make a big push this summer to try and get that across the finish line in the Senate.

Well, he has to deal with urban America as well.

In terms of a it's a it's an aging bill, but it's also an asphalt bill.

George Jarrett it's enormously larger than it has been.

It is some provisions, though, in the big beautiful bill, though.

Don't kick in until like November of this year or, you know, at the end of this season.

So that's a problem.

And, you know, there's even a bigger issue.

And I'm very hopeful that the Senate will pass something this summer.

But I'm telling you right now, we have not passed a farm bill in this country since 2018, and we've just been basically doing a continuing resolution of the former farm bill.

And that former farm bill just never did enough.

And so I'm hopeful.

But, you know, this is an election year.

And so, I mean, it's not just that the farm community is fighting with the urban community for dollars in Congress.

It's also different, you know, ag producing states, you know, different states produce different things.

You know, some states produce, you know, like, you know, fruit, some states produce vegetables.

You know, we produce, you know, rice, soybean, corn, cotton, you know, that's our staples.

And so, you know, the you know, there's all sorts of issues like with, you know, livestock and dairy.

So there's all sorts of different components within even just the ag industry that are competing for dollars.

But, you know, covering politics for a long time, I'm hopeful they'll pass something, but I wouldn't realistically expect it necessarily.

We're a bit short of time.

But I want to end with Drew Flowers.

This is your life farming.

Yeah.

Is it going to be your life, your sons?

Your children, I hope I mean that's the that's the plan if they choose to do this.

I've got three boys, six, four and two.

They have a while before they get here, but they the plaintiffs, if one of them wants to do what I do, I'd love for them to do it.

If they want to do something else, I'll help them do whatever they can.

You've got friends who love farming.

I have friends who've left farming.

I have friends who have left farming.

This year.

I have, you know, some by choice, some by, you know, force.

So necessity.

Necessity.

That's right.

So that's.

It's a struggle.

It's a struggle for everybody.

And again I say I look at a budget every day.

I try to play with a different number and try to make different things work every day.

And that's part of the game.

Now, that used to be we could go out.

We used to have built a budget in November, December, I could plan for it.

We could go grow a crop and make it.

It was up to me to make a good crop.

Well, now it's up to me to make a good crop and don't stomp your toe.

And your marketing decisions got into their Drew Flowers, Hiram Hunter Byram I'm sorry.

And George Jared, gentlemen, thank you for coming in and come back again soon.

Maybe the news will be a little bit better when you do.

Thank you.

And we'll be right back.

We are back.

A deadline is approaching.

Enrollment ends June 12th for thrive, which is one of the four components of the state's Rural Health Transformation program, opening soon.

Very soon, in fact, is the window for thrives.

Three siblings packed Rise and heart.

The four elements are intended to make medical care more accessible in parts of the state that traditionally have been underserved.

Department of Finance and Administration is overseeing the implementation of the program or assisting.

And the the director, Secretary Jim Hudson, is with us now.

Thank you, Mr.

Secretary, for coming in.

Thank you for having me back, Steve.

Well, where does this the debt explain the deadline?

Well, the the deadline is really for the first phase for thrive in terms of getting the applications into our electronic portal.

And so we'll take an opportunity.

We'll review those applications, make sure they meet the requirements for the program, and then move into an award phase and decide who gets awards and then how much those awards would be.

So we're really excited that we're opening this phase with thrive, because we really think the thrive part is a way to transform delivery of health care in rural Arkansas, really focusing on some technology enhancements that maybe not available for hospitals in the current setting, because maybe because the capital is not there for them, we can help buy some of that technology to make health care delivery a little bit more, more advanced.

What agencies, what entities now are applying on really it's providers, providers, nonprofits, clinics, hospitals, the ones who have the ability to actually have that direct patient contact, either the ones who are applying for it.

Well, and that's that has been in the past anyway, sort of the soft spot for health care in our in rural Arkansas.

Yeah.

And I think with rural Arkansas, obviously there is there is a financing issue with the health care in rural Arkansas.

You know, our hospitals are struggling in lots of ways.

And so this program with RTP Rural Health Transformation Program has the ability to inject capital that is not currently present in rural Arkansas to help them do some things they wouldn't otherwise be able to do.

For example, well, let's use, for example, chronic diseases.

Arkansas has way too many incidences of certain chronic diseases diabetes, for example, high blood pressure, morbid obesity.

You know, if we could do a better job helping Arkansans take care of themselves, we would begin to bend that cost curve a little bit.

So one of the things I'm very interested in is remote monitoring for chronic disease management.

I want you to imagine this, a situation where you have a diabetes patient and he or she, you know, maybe they're not being compliant with their finger sticks, they're not monitoring their glucose levels, and then they end up having complications.

They go to the E.R.

and have a maybe a bad outcome with that.

With remote monitoring, we'll be able to give them a glucometer that will be tied into a call center, and they'll be able to get prompted to check their blood glucose.

And then if the readings are somehow askew, get some information on what they can do about that.

And they can also inform their health care provider how their blood glucose is going.

And here's another thing that I like about this is it can also let a family member.

No.

And so if you think about having a senior family member get a text in the morning and says, okay, dad is up, he's checked his blood glucose, it's doing well.

You know two things.

Dad's healthy and dad is up.

I think it's been great for for families as well.

Well, but you also have one of your obstacles is lifestyle choices anyway.

And and you talked about chronic illness.

There's so much of which stems from well, you mentioned obesity.

But also, you know, we have addiction issues.

We have tobacco.

Absolutely.

And, you know, tobacco cessation is one of those programs.

I think Arkansas has led the nation.

And we're actually seeing a declining rate of smoking in this state, thank goodness.

But there's more ground to take there.

You know, I think just general lifestyle management and making better choices with exercise, making better choices with our food, that's an important part of this.

You know, one of the things I share when I'm with groups, community groups, you know, Arkansas has some of the most fertile cropland in the world.

And yet we have so many of our people who are having to buy processed foods.

And a matter of a couple of generations, some Arkansans have lost the knowledge base about how to grow a garden.

And so I think one of the things we'll see with this program is the opportunity to help communities do a better job of establishing local farmers markets so that they can buy fresh food, and then also offer educational opportunities to teach families how they can prepare that food in a healthy way.

Well, I mean, there's an education component in there as well that's almost essential to it.

I mean, it's cheaper to eat poorly, stupidly than it is eat smartly, seemingly so it's cheaper in the long term, way more expensive in the short term to the system?

Sure.

Absolutely.

Absolutely.

And I think one thing that we see, particularly from the federal government and the doctor, Oz and Secretary Kennedy, are very big on this is food is medicine.

And so to be able to emphasize to Arkansans, the food you put in your body has a direct impact on your health.

And while it may seem like it's easier and more convenient to buy that highly processed food, there's some simple things you can do to maybe prepare more of that food yourself.

At home, we won't help our cans and see how they can do that.

Here is another option.

You mentioned Secretary Kennedy at the federal level and his skepticism about vaccines.

All the data indicates that in some key areas, vaccination rates are dropping.

And public health officials are absolutely appalled that that that could make the job even more difficult.

Could it not?

Well, I think with I think vaccinations or we're not doing anything different with that.

You know, we're encouraging, you know, Arkansans to be vaccinated.

You see that in our public health approaches.

I think a little bit of that is just, you know, some of the things that the federal level may be dealing with, some of the excesses that have occurred previously.

I think for us, we want to make sure that we're empowering Arkansans to be in charge of their health and giving them all the information they need, they need in order to make good decisions about that.

Here's another federal aspect that you may be up against.

Well, you almost certainly will be.

The administration has unveiled some new and tougher requirement work requirements anyway for participation in the Medicaid program, and that is almost certainly likely to increase the pressure on lower enrollment, which will increase the pressure on the system.

Is this is this?

Yeah, I think I'm aware from there.

Yeah, I think I would challenge the premise on that.

You know, if that's the glass half full or half empty, here's the half full approach.

I think the work requirements, which Governor Sanders believes very strongly in, and I think she was already asking for that waiver before you saw work requirements.

And the one big beautiful bill.

I firmly believe that the best thing I know, the governor believes, is to the best thing you can do for our Kansan is get them a job.

And then when someone has a job, all sorts of good things happen after that, including having access to health care.

And so the goal here is not necessarily just to get people off the Medicaid rolls.

The goal here is for people to be at work.

So they actually have access to health care through their employer, and they have the ability to pay for that as well.

You know, if folks, because of where they're at and season of life, they have kids, their disability.

There are exceptions to the work requirement.

But as a matter of policy, both at the national level and at the state level, we believe that people who are able to work should work.

But in in the interim, though, is that not going to increase enrollment?

Is it fell less time and it's falling again is it not.

Well we haven't implemented.

Yeah.

They'll start in July wait to be be seen.

I think we're doing a good job educating beneficiaries about what their responsibilities are.

But if someone leaves Medicaid because they're not eligible for Medicaid, I don't consider that a bad outcome.

I think we want to make sure that we're helping them in all the ways we can to get access to a job so they can, again, get access to health insurance through that job.

There's news on the digital front.

You continue to move state program DFA programs anyway toward the smartphone instead of the wallet.

Yeah, we really believe, at least not the digital wallet.

Right?

Sure.

We really believe, you know, state government across the board, you know, has to move more aggressively into the digital space.

Governor Sanders, when she launched the Arkansas Forward initiative a couple of years ago, that was really aimed both at controlling costs but also providing a better experience to the customer.

And, you know, right now, I would say state government is way too paper bound.

You know, we must embrace the digital aspect of things.

And so we're doing that.

We announced last week that we've integrated our mobile ID with Apple's digital wallet.

So like with me on my Apple phone, my iPhone, I have my digital credit cards there.

I've got a digital version of my passport there.

If I'm traveling, I have my boarding pass there.

Now, you'll have your Arkansas driver's license there as well.

So when you're going through the airport, you have to fumble for your driver's license.

You can just put that up against a proximity reader there at TSA and they'll say, yep.

You're Steve Barnes, you get to get on your plane.

That's what we want to be able to do, but we're not stopping there.

I tell this story.

We're we're digitizing our our registration process for new vehicle purchases.

Right now it's so paper bound.

You know, two years ago, 2024, scanned 18 million pieces of paper just for car registrations.

18 million.

Now, we left timber in Arkansas, and we love paper in Arkansas, but that's too many pieces of paper.

So, you know, we're going to make that a digital transaction and cut down on the amount of paper we're generating.

Well, what if Steve Barnes goes about ten miles an hour over the speed limits?

There's blue lights in my window.

You're still not there yet.

I can't show the.

The office of my phone.

Used to be real nice to Colonel Hager.

And just see if we can't get that taken care of.

But, no, you still have to have your physical driver's license in order to be able to drive a car.

There will be a day, probably not in the two distant future, where our troopers and local law enforcement will have the technology to be able to read that digitally where it's not there yet.

But I'll tell you where we are.

University, Arkansas, you know, and give you a good use case on that University of Arkansas this fall at the Razorback Stadium.

You know, if you're buying a beverage that requires you to have an ID to show that you're 21 years old, they'll be able to use our mobile ID there with your Apple Wallet and say, yeah, you are who you are, and you're able to actually buy that beverage.

I expect we're going to see more restaurants moving that direction as well, because we have a lot of fake IDs that are coming into us from overseas, and that mobile ID is credentialed and authenticated immediately.

So if you're serving alcohol, you know that person is giving you a valid ID and that giving you a really good fake ID got into their because we're out of time.

Mr.

Secretary, as always, thanks for coming in.

Thank you.

And that does it for us for this week.

As always, we thank you for watching and see you next week.