Lankford Recognizes on Senate Floor the Work of Oklahoma Ag and Energy Industries during COVID-19
CLICK HERE to watch Lankford’s remarks on the Senate floor.
WASHIINGTON, DC – Senator James Lankford (R-OK) today provided an update on the Senate floor of what the Oklahoma agriculture and energy industries are experiencing right now and what they see on the horizon with the impact of the coronavirus on markets, production, and workforce reductions. Lankford highlighted personal stories from Oklahoma agriculture producers in Jefferson and Washita Counties and their work to overcome the obstacles derived from the coronavirus. Lankford also highlighted Oklahoma energy issues as national and international demand for gasoline remains very low but demand for petroleum-based products, especially those used for personal protective equipment (PPE), remains very high.
And this time, it’s interesting to note with all that’s going on, America is still eating, America is still moving because there are essential workers that are still serving. They’re healthcare workers, they’re grocery store workers, they’re trucking. They’re folks at convenience stores and gas stations, sanitation workers and power generation, they’re farmers and ranchers, they’re at refineries. Yes, they’re even in government, public safety, law enforcement.
While the news every day covers folks that are at home waiting to return to work, we at times forget the people that are working twice as hard right now to be able to make sure that’s even possible. And we’re grateful for what they’re doing. We’re grateful for the sacrifices of their family and of the hours that they’re putting in. But I want to be able to highlight a couple different groups that are unique in this mix. Some of the folks that are really truly behind the scenes in it that we really don’t see a lot, but we see the end result of their product.
Let me start with farmers and ranchers. They are the folks taking care of making our food because, as we know well, food does not grow in the grocery store. It has to happen somewhere by folks putting the work out in the sun and getting a chance to be able to bring that crop in. We’re watching it happen across my state and across the country right now. Wheat is coming in, and in Oklahoma it looks beautiful. It’s green still, but in the days ahead as it comes in it will be very important to us. But it will be interesting to be able to see this crop, if it’s not taken out by the hail that’s coming in this weekend. This crop, as it comes in, will be very important to us. But the challenge will be that this year the H2A workers that typically come in from all over the world that do custom cutting are not able to come in this year because of the coronavirus. The challenge will be: will Americans step up when literally the harvest is plentiful but the workers are few. Will Americans step up and say, ‘I will not let that harvest go to waste. I will engage in bringing the harvest in’?
Folks that are in forestry—and yes forestry and logging is a crop in Oklahoma. For those of y’all that haven’t been there, it’s the eastern side of our state. It’s incredibly important to us, and we’re seeing a boom in that area thanks to things like a great need for boxes for everyone getting all their materials shipped to their house right now and this small commodity we call toilet paper that there seems to be a run on it going on right now. Cotton, corn, sorghum, beans, so many things that are so important that are behind the scenes that if we lose track of the fact, we’ll just miss it.
One of the things that has been in the news lately has been livestock and the processing of those livestock. It’s been news about how coronavirus has spread in some of those facilities, and I have one of those facilities in my state. It’s Seaboard. It’s a tremendous operation where folks have worked for decades in a tremendous place to be able to harvest those hogs, to be able to turn them into fabulous things like bacon and pork chops. In this location in Texas County in Guyman we’ve seen an outbreak in Texas county. The folks at Seaboard Farms have stepped up to it. Ninty-five percent of their workers have been tested and they’re in the process of doing a different test all over again just to be able to track and to be able to find even the people that were negative if they’ll show positive the next time to be able to make sure they’re staying on top of it. But they’re running at 60 percent operation right now. That may not seem like a big deal to you but that’s about over 7,000 hogs a day not being be harvested. They are being what’s euphemistically called depopulated. That’s a tremendous loss to everybody in the entire food chain.
We’re seeing major issues that are also happening with our beef production, because we’ve had enormous issues on trying to be able to harvest those animals. As we go through the process and all the challenges, it becomes extremely personal to a lot of the folks in my state. In my state, this is not just a theory. In my state this is actually happening to real people. It’s Jim Howard, a fourth-generation rancher who ranches in Jefferson County. His whole family—his brother, his wife, his grandsons, sons-in-law—everyone’s all involved in the operation. They have ranching, cow-calf, stockers, feed lot operation; they’ve got it all. But at this point they’re facing between 35-percent and 40-percent loss in the prices of cattle. Literally he loses money on every single cow.
It’s Robert Frymire from Custer County, a third-generation wheat and cattle farmer. Using today’s wheat prices even with that crop that’s coming in, he will lose $150,000 this year on his wheat crop, not to mention what’s going to happen on beef cattle. There’s a reason that we’re trying to be able to put solutions in the CARES Act. There’s a reason we put $19 billion there to be able to help our food supply. $3 billion of that has gone towards providing for our food pantries and nonprofits and places to be able to get food out to people so that food doesn’t go to waste. But there is direct aid going to farmers and ranchers to be able to keep those organizations alive long term because we need them to exist at the end of this. And we’re grateful to be able to come alongside with them.
There are challenges on the packing operations that are not new. They have been around for a while. And we’re pushing in a couple of areas to say, ‘we’ve got to solve a couple of these problems.’ Our small packinghouses that are out there, they pay almost $80 an hour for overtime fees. $80 an hour for each inspector to do overtime seas. If we’ve got a location like Seaboard Farms that goes down, and they want to go out to another location and to be able to ramp up, they’re financially punished from being able to do that, and they can’t make the math work. We have to solve that so that we’re not punishing small-to-medium size operations from ramping up in moments when we need them. And we need those small-to-medium to be able to ramp up and grow larger.
We have to solve the issue of the CIS Program that is allowing folks to be able to see over state lines. Twenty-seven states including my own have state inspection programs that equal to the USDA program. They have to be equal to it, but they’re still not allowed to be able to sell over state lines until they get the CIS Program, and only three states have been able to complete that. This should be logical. We should be able to solve this. Those two things would allow long-term fixes for the packinghouse operations, something that we’ve complained about for a long time. We should solve at this moment because it’s become even more obvious.
The issues about energy continue to rise for us. We as a nation are finally energy independent. Finally. We choose to buy energy from places we want to buy energy because we can produce it ourselves. But we cannot go backwards to a time period when we’re dependent on the Middle East again because of what’s happened in COVID-19. We’ve got to be able to pay attention to this. There are commonsense solutions that I understand full well, there are some folks that don’t like fossil fuels. I get it, but those same folks fly on planes and we drive cars and trucks and like wearing clothes and we like having paint. And all of those things that are disposable now like PPE, guess what they’re made of? Petroleum.
This challenge about ‘let’s try to get away from petroleum,’ it’s been interesting to me how many people have suddenly gone from let’s reuse everything to the last two months saying, ‘no actually we want disposable everything now.’ Well, guess what? Those disposable items are made with petroleum products. We do need this balance. We can do it clean but we’ve got to keep this part of the industry open and still functioning. And if the whole system collapses, we will not be able to do that.
Many of you know my state is a production state. We at times will have hundreds of wells for oil and gas that are happening. Right now in the entire state of Oklahoma, there are 12 rigs working. Twelve. That’s the collapse of thousands and thousands of jobs. And if those jobs and those companies go away, that does not recover. And we’re suddenly dependent on the Middle East again. We cannot go there. We have to be able to resolve that.
It’s why the Paycheck Protection Program was opened up to small businesses, yes, even energy companies, to help sustain them for a couple of months to be able to get through this, but it’s going to be a very big challenge for them. Quite frankly, something that’s news to this body that I want to just be able to raise, in 2007, long before I was in Congress, Congress passed an act dealing with ethanol, mandating a certain number of gallons of ethanol to be used every year. Well, guess what? America wasn’t driving in March and in April. That means we’re not going to be close to the number of gallons of gasoline that we normally use, but we still have a requirement sitting out there for the number of gallons of ethanol that have to be used this year.
We literally have an energy ticking time bomb based on a bad law that was written years ago dealing with ethanol. And if we’re not careful, we’re going to cause even bigger challenges in energy based on that law on ethanol and the number of gallons that are required when there is literally no way even if we poured it on the ground, we can use the gallons required in that law. That’s going to be an issue for us. And it’s one that we need to be able to work cooperatively and in a nonpartisan way to be able to say, ‘let’s have some commonsense in this moment to be able to solve how we deal with our energy.’
Lest the prices of gasoline explode at the backside of this, not because of undersupply, but because of ethanol regulations. We should not allow that to be able to occur. And we should be able to not only solve that for this year but solve it long term.
I’m grateful for the folks that are farmers and ranchers and work in the energy industry, folks that work behind the scenes that make America move because in the days ahead we’ll start moving. As my state has already reached phase two of reopening, and we continue to see a decline in the number of cases, but those folks that were working behind the scenes the whole time are making the difference for us.