After years of paying the highest or second highest dues in the National Association of Wheat Growers (NAWG), the North Dakota Grain Growers Association (NDGGA) voted to withdraw from the national organization effective June 30.
“In recent years, our North Dakota growers have not been seeing a return on their investment,” said Jeff Mertz, NDGGA president and wheat grower near Hurdsfield. “NAWG still provides value to producers on a national level. However, our foremost focus is on North Dakota farmers.”
NDGGA represents wheat and barley grower/members in the state.
Mertz said the problems with NAWG are twofold. One problem revolves around NAWG’s style of running the organization, including giving equal representation among states, no matter what the size of wheat production is.
The other problem is that NAWG has not always followed what NDGGA has asked the national organization to do to help North Dakota growers with risk management and other issues. That has cost state wheat growers economically.
NAWG provides three tiers of membership dues for its state members; and no matter how much a state pays in dues, all states have two delegates.
“Whether a state pays $20,000 a year in dues or more than $200,000, each state has two delegates across the board,” Mertz said. “That doesn’t seem fair to the larger wheat states.”
North Dakota is the top wheat producing state in the nation and first in wheat exports at 50 percent.
According to Chandler Goule, CEO of NAWG, either North Dakota or Kansas would pay the third tier of dues, the highest amount, depending on which state had the most wheat production that year.
The second tier of dues is for the number two wheat producing state, North Dakota or Kansas, along with Montana and Washington.
The first tier and the lowest amount are for the rest of the wheat-producing member states.
“In order to give everyone fair representation, we give every state two delegates, no matter how much they pay in dues,” said Goule.
Many of NDGGA’s board members and members live in the western side of the state and went through a serious drought in 2016, and the 2017 exceptional drought.
“We requested to pay half our dues in 2017 due to the drought, and we have continued to pay half our dues since then,” Mertz said. “Wheat is our bread and butter, but the last two years, we have not only had drought, we have lost a lot of wheat acreage to other crops.”
Because NDGGA was paying half dues, NAWG took away a delegate from North Dakota, leaving the state with only one delegate and one vote.
Mertz and NDGGA board members wondered why NAWG would penalize them for drought and production problems. Even with half dues, North Dakota was still paying more than many other member states.
“NAWG wanted us to pay full dues again this year,” Mertz said. “We refused to do that.”
Mertz said being equal can sometimes mean North Dakota growers’ issues and needs are not top priority with NAWG – to the detriment of wheat producers in the state.
A big example is during the 2008 Farm Bill discussions, where NAWG failed to ensure a quality loss provision was included in the crop insurance program because it did not impact the southern wheat producing states.
If there is cool, damp weather during harvest, North Dakota wheat producers have to use glyphosate to dessicate and dry down wheat acres. North Dakota producers have also had problems with sprouting at flowering, causing vomitoxin issues, among other quality issues.
“Those are the kind of crop quality issues we wanted written into the crop insurance Risk Management Agency (RMA) program in the 2008 Farm Bill,” he said. “I can’t believe we couldn’t get NAWG to do it.”
While that has been a decade ago, that issue had the greatest impact to North Dakota wheat growers.
“But a few years ago when Kansas had vomitoxin problems and later, when the Pacific Northwest had falling numbers issue, NAWG considered it a big problem and did something about it,” Mertz said. “It frustrates our board members.”
NDGGA board members had to ask if staying in NAWG was worth it if the national organization was not working as hard as it should for the largest wheat producing state in the nation.
Mertz points out he lost his entire durum crop from high vomitoxin levels in 2014. If NAWG had the quality issues already in the RMA in the crop insurance program part of the Farm Bill, he would not have had to worry.
“We had crop insurance, but if you take a crop insurance claim, then your APH (Actual Production History) goes down. Even though you had the bushels, they aren’t worth anything,” Mertz said. “It’s a fine line. Do you take crop insurance and hurt your yield when you have a crop failure on the production side, or do you try to grow enough durum to blend it off eventually?”
Goule said he and his current officer team wasn’t around in 2008, and NAWG did eventually push for the RMA inclusion into the 2018 Farm Bill. But that is 10 years without the inclusion.
If a larger production state wanted a policy adopted at NAWG, that state can call for a weighted vote option, Goule said. However, the state would still need to find a couple of other states to go along with it.
“But if North Dakota and Kansas voted together on a policy, it would not matter what the other states voted. Together, they always have the votes to put in place any policy,” Goule said.
That infers the two states, one in the north and one in the south, producing mostly different classes of wheat, with entirely different issues and production factors, would always push for the same policy.
Meanwhile, NDGGA asked to stay at half dues this year.
“We wanted to stay at half dues this year while negotiations continued, but NAWG voted it down,” Mertz said. “The only state that voted with us was Minnesota, and I want to thank them for that.”
NDGGA only had three votes in its favor, one from Mertz and two from the Minnesota delegates.
Mertz doesn’t discount the work NAWG has done in partnership with NDGGA since 1977, but NDGGA has been trying for the past three years to work out a resolution.
Goule said, for their part, NAWG has worked on North Dakota’s issues.
“We tried to work on their concerns, and we have completed most of their requests,” Goule said. “But I do think we have exhausted everything we could to keep NDGGA part of NAWG.”
Goule said they have reduced their budget 10 percent or from $60-100,000 each year, over the last few years. However, they do have a $1.3 million budget, of which there are six permanent employees to pay salaries for.
The main thing NAWG provides its wheat members is access to Congress, Goule said.
“North Dakota provides us dues and what we provide back is access to some 20 plus states’ Congressmen and Senators,” he said.
But NDGGA concluded that was not enough.
“We just want a return on our investment, and we haven’t gotten that. We feel we can do better for less with our own lobbyist working directly for NDGGA,” Mertz said.
NDGGA hired a lobbyist last year to solve some water issues for them, which the lobbyist did to their satisfaction. He opened all the doors to Congressional offices that North Dakota needed to talk to.
“We’re very confident in his abilities, and excited about our future,” Mertz said.
Sonny Perdue, USDA secretary, was at Petersen Farms Seed in southeast North Dakota a week ago, and NDGGA board members, including Mertz, were there.
“There was a lot of talk of trade, and he’s a farmer; he knows (our needs),” Mertz said. Perdue talked trade and NDGGA knows China used to buy U.S. hard red spring wheat due to its high quality.
Perdue said the U.S. trade teams are getting closer to resolutions, according to Mertz.
Besides China, Mertz added the U.S. needs to resolve its trade dispute with Japan, the U.S.’ number two wheat importer.
“Besides China, we need to get our trade dispute settled with Japan. We are at a 40-cent disadvantage to Canada right now,” he said.
Goule said NAWG has set trade as their number one 2019 policy. He hopes the U.S. administration does not increase tariffs on China again until a trade resolution is reached.
“It won’t directly affect wheat, but will put an additional layer of complication between Congress’ Senate and House to get the USMCA (U.S.-Mexico-Canada Agreement) passed,” Goule said. “The USMCA is very important for U.S. wheat.”
Goule said he was disappointed NDGGA left the organization May 7, but he was “not surprised.”
“We want them to know the door is always open at NAWG,” Goule said. “We hope they will come back and join us.”