LANSING – Agriculture has been hit by the state’s economic struggles, but that means falling to only single-digit growth instead of the double digits it had seen in some recent years, Agriculture Director Don Koivisto told Gongwer News Service in a recent interview.

The state’s farmers and food processors are poised for more growth as the economy picks up, Koivisto said. But they will see somewhat less help from the department as they build and expand.

The department has cut back on its economic development efforts with the loss of its division dedicated to that growth.

“That’s been a real key thing for us,” Koivisto said. “We still do that on a reduced scale. We still have a few people left to do that.”

And he said the department has better developed its cooperation with the Michigan Economic Development Corporation since losing its development arm.

“I would say we have a very good partnership with them now,” he said. “We team with them now.”

But in any case, the state’s agricultural economy is stronger than the economy in general.

“We have over 500 food processors. Their employment levels are substantial,” Koivisto said. “We do not see that going away. It’s stabilizing for now and growing with the economy.”

And the state has seen 3,000 new farms develop in the last decade. “There are 56,000 farms in Michigan that are still intact for the most part,” he said.

One of the key areas where agriculture has been hit the last couple of years is exports as the world saw economic declines.

“We send a lot of (exports) to China and India,” Koivisto said. “They had a downturn and they’ve slowed their purchasing.”

The state also saw milk prices fall and pork sales were hit initially by the swine flu outbreak.

And the department has less funding to help farmers market their goods, Koivisto said. One of the casualties of losing the economic development division was the Select Michigan program that encouraged purchase of Michigan-grown produce.

“We still give advice when people call,” he said. “We can’t do as much promotion of it as we’d like.”

And he said cutting the program was particularly ill-timed because there is a growing emphasis on buying local food. “Food is one sector people have started to identify with,” he said.

The department has also been struggling to find support for farmland preservation programs. There are 3.3 million acres under the current PA 116 program, but there has not been as much movement to add land in recent years.

“There’s little state and local funding,” Koivisto said.

The state is, however, seeing 91 percent of those with PA 116 contracts coming due renew those contracts.

Little is happening at the moment also because the Farmland Preservation Board is being reconstituted under the executive orders that moved Koivisto’s post to a gubernatorial appointment.

Koivisto said urban agriculture, particularly in Detroit, will see growth in the coming years, but he warned supporters of the idea to not be discouraged if there are not suddenly hundreds of acres in development.

“It’s slow in developing because it’s new,” he said.

But he said the city has land available and has opportunities for a number of developments. In addition to the ideas that have been circulated for produce farms, he said the city could also be ideal for constructing greenhouses or for growing non-food crops like switch grass that could be used in ethanol production.

But ethanol development nationally has stalled some, largely because it built up so rapidly a few years ago, Koivisto said. “There was a rapid build up. It was causing corn and farm prices to go up,” he said. “There was such a growth that it couldn’t be sustained.”

The sector lost some market also as the price of gasoline fell last year.

The state has only lost one of its planned ethanol plants, however. “I see no rapid growth, but I see stabilization,” he said.

And he said ethanol will continue to be a substantial player in alternative energy, particularly with a federal push to increase the amount of it blended with gasoline for most uses.

The state, particularly its soybean growers, could also benefit from a new push for biodiesel mixes, Koivisto said.

Despite the growth in the industry, the department will see further shrinking in its budget for 2010-11, and Koivisto said the agency could manage through those cuts.

Whatever happens with the department’s funding, Koivisto expected the Legislature to follow his recommendations on the food safety program. “We continue to be on top of things there,” he said. “Everybody realizes the importance of doing that.”

And he said the cuts recommended by Gov. Jennifer Granholm do not indicate how she values the agency. “I’ve had two different meetings with her,” he said of Granholm. “She wouldn’t be asking what we can do to enhance agriculture if she was down on agriculture.”

And he said, at least for now, it appears his department will remain whole. “I don’t see any clear plan that’s pushing that,” he said of possible merger of the department with another. “There’ve been a lot, myself included, saying that Agriculture has a unique mission. …It really doesn’t tie in with somebody else.”

This story was provided by Gongwer News Service. To subscribe, click on Gongwer.Com

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