Post-USDA, Northey eyes consulting on climate, water quality, conservation

Former Iowa Agriculture Secretary Bill Northey’s new career could involve consulting on some of the nation’s most pressing issues: climate change, water quality, and conservation.

In January, Northey wrapped up his Trump-era stint as an undersecretary at the U.S. Department of Agriculture. After he was confirmed by the Senate nearly six months after his nomination, Northey managed some of the nation’s most important farm and conservation programs. His professional world involved 20,000 people scattered in 3,000 offices at a time when a trade war with China and USDA employees’ shift to working from home due to the coronavirus pandemic made things even more interesting.

Now, Northey is consulting part-time for the Walton Family Foundation’s conservation programs focused on the Mississippi and Colorado river basins, and for General Food Rural Partners. GFRP is a $125 million fund aimed at driving rural development by applying university-developed intellectual property.

Northey has moved back to Urbandale from Washington, D.C., where he enjoyed exploring mostly rural areas of Virginia, New York and Pennsylvania in his spare time. His sister and brother-in-law rent Northey’s farmland in Dickinson County, Iowa.

At 61, Northey said he is eager to find a full-time job, but could end up working as a part-time consultant until he retires. It all depends on opportunities, he said. 

Northey is a fixture in agricultural circles. In addition to his decades as a family farmer, he served as Iowa agriculture secretary from 2006 to 2018. He also was president and chairman of the National Corn Growers Association. At USDA, he held a new position, under secretary for farm production and conservation.

In an interview Monday, Northey talked about whether the nation is doing enough for water quality, whether the ethanol industry should plan on phasing out as electric vehicles proliferate, and how renewed attention on carbon trading will affect Iowa farmers.

What’s the future for ethanol?

President Joe Biden’s discussion of a shift to electric vehicles has many in Iowa — the top producer of corn-based ethanol — wondering if biofuels are on the way out. During the campaign, Biden said he wants to “transition” away from the oil industry, with the U.S. reaching net-zero greenhouse gas emissions by 2050. 

Some, like Des Moines City Councilman Josh Mandelbaum, are hedging their bets for now. Mandelbaum has one electric vehicle, and one that burns gas. He figures convenience stores will be selling gas for years yet, giving the ethanol market some time. 

Northey suggests a phaseout is a matter of time.

“My sense is they’re looking very seriously at (a phaseout). We need to see what the timeline is. Is that a 10-year timeline or a 50-year timeline?” Northey asked. 

Some ethanol plants closed temporarily during the pandemic, with some shifting to make hand sanitizer. For years, there’s been talk, and even Iowa State University studies, about converting ethanol plants to make alcohol for the beverage markets or for mouthwash, for example. But Northey said the 43 ethanol refineries in Iowa, with a combined 4.5 billion gallons of production capacity, might have a hard time selling that much to the bars and mouthwash manufacturers.

Ethanol plants can capture carbon dioxide that comes off the fermentation process, using it for carbonation of products or for cooling and freezing. That might enter into the discussion over carbon balance in the corn industry, Northey added.

Here are Northey’s takes on other topics:

Q: Can voluntary programs fix Iowa’s water quality issues, or is it time to consider mandates?

A: I still like the voluntary (approach). We are seeing progress. Some would argue whether it’s fast enough. Things like cover crops. We don’t require them, but we certainly are seeing an increase. It engages the farmer in a different way. I think it makes the farmer part of the solution instead of just saying, ‘what does it take for me to be legal?’

Q: Congress in recent history has been reluctant to spend more on farm programs, and has cut some (setting aside nearly $50 billion in pandemic and trade-war payments). With Conservation Reserve and similar programs leading voluntary efforts, do you think enrollments will increase under the new administration?

A: In the 2018 Farm Bill, they put a cap on what we can offer for rental rates (for land in conservation programs). It’s hard to make those rates competitive with (private) land rental rates and what people can make with $5 (a bushel) corn or $11 (a bushel) beans.

Q: How big of a deal is the idea of paying farmers to help sweep carbon from the air with plantings? Will it change the bottom line?

A: There’s going to be an interesting tension with the discussion around climate and carbon. There are some things that absolutely help, like cover crops, which help water quality and carbon. But there will be some people who say we need to focus solely on carbon, and therefore it doesn’t matter where the cover crop is, whether it’s a water-quality-impacting area or not. But it’s more beneficial in areas where there is a water quality concern. 

I think in most places right now, the (carbon trade) rates that are being talked about are not a big impact on the bottom line. Folks are talking about these selling right now for $10 to $25 an acre. And this is on crops that, especially with the rapid recent increase in prices, are probably grossing $900 to $1,000 an acre. So (the carbon payment) is a very small amount. But I do think it is an additional incentive to pay for good conservation practices. Maybe someone who is already doing cover crops might go ahead and put them on more acres because they can get more of the cover crop expense paid. Maybe we can figure out (how to remove) more carbon and that would be worth more dollars. If it were $50 an acre, now that would be different.

What do you see happening with the China trade agreement?

We made some real positive, lasting changes. China did clear up and approve many plants for importation as part of the Phase One deal. Now, I say lasting — that depends if they continue. All administrations are tested about how they’re going to respond. It’s not an easy thing to figure out how to do it.