Down on the Farm: NAFTA's Seven-Years War on Farmers and Ranchers in Alabama

In the summer of 2001, family farmers and ranchers throughout North America are struggling. During the 1993 debate over the fate of the North American Free Trade Agreement (NAFTA), Alabama farmers and ranchers as well as farm communities across the U.S. were promised that NAFTA would provide access to new export markets and thus would finally bring a lasting solution to farmers off-and-on struggles for economic success. Now, seven years later, the evidence shows the income of independent Alabama farmers and national farm income has declined, consumer prices have risen and some giant agribusinesses have reaped huge profits. Total net income for farm operations in Alabama increased between 1993 and 1999 but all of the income gain was in corporate farms, when corporate income increases are eliminated farm income drops steeply in Alabama. Total Alabama net farm income grew by 31% between 1993 and 1999 to $1.2 billion. However, net farm income for non-corporate Alabama farm operations fell 74% between 1993 and 1999 from $51.4 million to $13.4 million. In Alabama, 2,000 farms have disappeared during the seven years of NAFTA. Nationally, farms have disappeared faster since NAFTA went into effect than in years that preceded it, but in Alabama, the number of farms grew before NAFTA was enacted but that gain was doubly reversed in the years since NAFTA. The total number of Alabama farms grew by 2.1% in the years before NAFTA (1988-1993) but fell by 4.1% after NAFTA went into effect between 1994 and 2000. These outcomes are defining the growing national debates over President Bush s proposals to establish Fast Track trade authority and to expand NAFTA through the Free Trade Area of the Americas (FTAA). This report documents the basis for farmers concern about NAFTA and its model of export-oriented agriculture with a special Alabama supplement which examines the impact of NAFTA on Alabama farmers. For the past seven years, the jewel of Alabama's agriculture, the state's peanut crop, has been decimated by NAFTA. Alabama farmers raising beef cattle have seen prices decline since NAFTA. Alabama tomato acreage and prices have declined significantly, facing significant import competition from Mexican tomatoes. Alabama wheat and soybean growers also have seen farmgate prices decline significantly since NAFTA went into effect. Alabama lumber mills have faced unfair competition from cheap imports of Canadian softwood lumber.

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