Crop Insurance

Another Temporary Fix: Stopgap Bill Includes Farm Bill Extension — Is This the New Normal for Ag Policy?

Tue, 11 Nov 2025 15:35:52 GMT

A new stopgap spending bill to reopen the government also extends key Farm Bill programs for one year—covering the provisions left out of July’s budget package. While the Senate waits on the House to vote, it brings up what some economists think may be a new reality: the days of passing a comprehensive Farm Bill may be over, and a piecemeal approach could be the new norm in Washington.

It’s been about 6 years and 11 months since Congress passed a new, comprehensive (5-year) farm bill. This week, the continuing resolution (CR), which funds the federal government through January 30, includes an extension of the current farm bill, again. This prevents outdated “permanent law” provisions from taking effect. Without action, those Depression-era statutes could have triggered mandatory price supports for certain commodities, disrupting markets.

The bill also includes an extension of the U.S. Grain Standards Act, ensuring official grain inspection and weighing services continue without interruption.

Senate Votes 60–40 to Advance the Measure

The Senate advanced the package in a 60–40 vote Sunday night, providing farmers relief from uncertainty over whether core safety-net programs might lapse.

An earlier package dubbed the “One Big Beautiful Bill” increased funding for commodity programs, crop insurance, and export promotion, but it left out several smaller and conservation-related initiatives—including the Conservation Reserve Program (CRP). The new CR temporarily fills that gap while Congress works toward a full Farm Bill reauthorization.

Boozman: “Critical USDA Services Resume”

Sen. John Boozman (R-AR), chairman of the Senate Committee on Agriculture, Nutrition, and Forestry, praised the bill’s passage, emphasizing its importance for both producers and rural communities.

“Ending the government shutdown ensures critical USDA services resume so vulnerable families no longer experience disruptions to nutrition benefits, farmers can access the programs and personnel they rely on to keep their operations running efficiently and disaster assistance is delivered,” Boozman said in a statement.“We advanced long-overdue farm bill policy improvements in the One Big Beautiful Bill, including enhanced risk management tools farmers have been calling for, and we’re continuing work to reauthorize other key initiatives. Extending the farm bill and the U.S. Grain Standards Act gives us more time to finalize these programs essential to farmers, ranchers and rural America.”

Is This the New Norm?

The extension buys lawmakers additional time to complete a comprehensive Farm Bill reauthorization, expected to be one of the top legislative priorities in early 2026.

But the loss of urgency to pass a new, comprehensive five-year farm bill may be due to the fact Congress included key enhancements to the Farm Safety Net in the One Big Beautiful Bill earlier this year. The Farm Journal Ag Economists’ Monthly Monitor asked economists in July if that makes it more difficult or easier to pass a Farm Bill this year. 70% said yes. And in September, the Monthly Monitor asked when Congress will pass a new farm bill. Nearly 40% (39%) said a piecemeal approach for passing the farm bill is the new norm.

According to the Congressional Research Service, Sections 10101 and 10108 (Title I, Agriculture) would increase federal outlays by about $52.3 billion + $1.6 billion over 10 years.

The American Farm Bureau Federation says the bill directs about $65.6 billion in new agricultural investment over 10 years: ~$59 billion for core farm safety-net enhancements, ~$6.6 billion for other ag priorities.

Key Farm Bill-style Provisions in the OBBB

Here’s a breakdown of major provisions in the One Big Beautiful Bill Act that impact legislation within the Farm Bill:

1. Extension & enhancement of commodity support / safety-net programs

The bill extends core programs originally in the Agriculture Improvement Act of 2018 (2018 Farm Bill) through crop year 2031.
Reference prices under the Price Loss Coverage (PLC) program are raised.
The Agriculture Risk Coverage (ARC) program’s revenue guarantee is increased (for example, from 86% to 90%) and maximum payment rates increased.
Marketing Assistance Loan rates are increased.
The bill provides a one-time opportunity for eligible producers to update base acres (“new base acre holdings”).

2. Crop insurance and disaster assistance

Premium subsidies for crop insurance increase; the bill boosts coverage levels for the Supplemental Coverage Option (SCO) and Whole Farm Revenue Protection (WFRP) policies.
Disaster assistance programs are expanded: loss types eligible are broadened, thresholds for payment triggers are lowered, and coverage levels increased.

3. Dairy, sugar, and specialty commodities

For dairy: The bill increases the amount of milk production a producer can enroll in the Dairy Margin Coverage (DMC) program. Also, it requires dairy product manufacturers to report cost/yield data so that “make allowances” under the federal milk marketing order system can be updated.
For sugar: Under the sugar support program, priority is given to sugar-beet processors if marketing allotments are raised; the bill also mandates reallocation of tariff-rate quota shortfalls by March 1 and requires USDA to report on refined sugar imports.

4. Agricultural research, animals, trust funds, and miscellaneous programs

Section 10108 of the bill funds: the National Animal Health Laboratory Network, National Animal Disease Preparedness Response Program, and the National Animal Vaccine and Veterinary Countermeasures Bank.
Extends funding for trust funds supporting pima cotton, wool, certain textile, and citrus industries.
Miscellaneous investments in horticulture, energy (for agriculture), trade promotion, and rural infrastructure also included.

While nothing is easy in Washington, it seems addressing portions of farm bill funding within other legislation is the path of least resistance. Which could change the way farm bills are shaped - and passed through Congress- in the years ahead.

Opposition to the Farm Bill Extension

While most farm groups applaud the one-year extension of the 2018 Farm Bill, the Institute for Agriculture and Trade Policy (IATP) says it comes with potential issues for small and medium size farmers.

“The Senate’s deal to reopen the government has a number of problems that will hurt farmers and rural communities. The Senate attaches a 12-month Farm Bill extension to the deal, setting up the possibility for more chaos just a year from now,” says Michael Happ, Program Associate for Climate and Rural Communities. “Even worse, it is not a clean extension. The text proposes eliminating payment limitations for Farm Bill conservation programs such as the Environmental Quality Incentives Program (EQIP). In most years, well over half of applicants to EQIP are turned away due to a lack of funds — and without payment limits, the USDA will likely issue fewer, larger EQIP contracts. By getting rid of the payment limit, the Senate opens the door for more of EQIP’s finite resources to be diverted to the largest operations while more small and midscale farms are closed out.”

IATP is urging the Senate needs to keep payment limits in place and go back to the negotiating table.

What's Missing in the Big Beautiful Bill When It Comes to Agriculture?

Tue, 10 Jun 2025 17:04:35 GMT

The fate of President Donald Trump’s One Big Beautiful Bill is with the Senate. The 1,000-page bill includes nearly $4.9 trillion in tax breaks and budget cuts, and is also packed with priorities that cover agriculture . That includes one provision that will allow community banks to pass along lower interest rates to ag producers. However, not all of agriculture’s wants are in the bill.

American Farm Bureau Federation (AFBF) recently dug into the details of the massive bill being debated in Washington. According to the nonpartisan Congressional Budget Office (CBO), the House-passed version of the One Big Beautiful Bill Act would increase spending for agriculture-facing programs by $56.6 billion over the next decade. Of that increase, $52.3 billion is for enhancements to the current farm safety net, including higher reference prices for ARC and PLC, and $4.3 billion is for trade promotion, livestock biosecurity, research and rural school funding.

According to AFBF, the One Big Beautiful Bill Act would increase agriculture-facing programs spending by $56.6 billion over the next decade (fiscal years 2025–2034).

(American Farm Bureau Federation (AFBF) )

According to AFBF, here’s what the current version of the bill includes for farm bill provisions (Title 1, Subtitle B-Investment in Rural America):

Updates and funding for many core agriculture titles through 2031.
Enhancements to safety nets including ARC, PLC and Dairy Margin Coverage (DMC) through the 2031 crop year.
Increases to reference prices for major covered commodities between 11% to 21% under the farm bill provisions of the bill.
Addition of a reference price escalator mechanism beginning in the 2031 crop year, which AFBF says would increase reference prices by 0.5% annually on a compounded basis. That increase is capped at 115% of the original statuary value.
Permits for farmers to add up to 30 million new base acres
Updates to ARC by adjusting revenue guarantee and the payment cap beginning in 2025. That would increase the coverage threshold to 90% of benchmark revenue, and increase the payment cap of 10% to 12.5%.
Enhancements to the DMC program and an increase of Tier 1 coverage eligibility from 5 million pounds to 6 million pounds per farm.

Proposed changes to the safety net

(AFBF)

Changes to Conservation Programs
AFBF’s analysis of the reconciliation bill shows long-term funding authority for USDA’s major conservation programs will continue through 2031. That includes the Environmental Quality Incentives Program (EQIP), Conservation Stewardship Program (CSP) and Agricultural Conservation Easement Program (ACEP).

The levels are higher than what was included in the 2018 farm bill, but align with funding under the Inflation Reduction Act (IRA), making these programs permanent baseline versus new program expansions.

AFBF says the bill doesn’t retain all IRA-funded initiatives.

“For example, it rescinds $450 million in unobligated IRA funds that had been allocated for competitive forestry grants to non-federal landowners. According to the Congressional Budget Office, these adjustments collectively result in a net reduction of $1.8 billion in conservation spending over the next decade,” said the AFBF analysis. “The bill also renews smaller initiatives that were not funded in the last farm bill extension. This includes the Grassroots Source Water Protection program, which safeguards well water, and the Voluntary Public Access and Habitat Incentive program, which rewards farmers for opening land to hunting and recreation. In addition, the Feral Swine Eradication and Control Pilot Program, a vital initiative to combat over $1.6 billion in annual damages caused by invasive wild pigs, is extended with new funding through 2031.”

Focus on Trade
Another important element included in the House version of the Big Beautiful Bill includes establishing a new Agricultural Trade Promotion and Facilitation Program, which would be similar to Market Access Program (MAP) and Foreign Market Development (FMD), while also providing $285 million annually in permanent, mandatory funding through a separate account.

“Because the bill does not modify or replace MAP or FMD, which are typically funded at $200 million and $34.5 million per year, respectively, the new program effectively doubles USDA’s total trade promotion capacity,” said AFBF’s analysis.

National Pork Producers Council (NPPC) CEO Bryan Humphreys says the trade portion of the bill, as well as the tax provisions, are a “win” for livestock producers.

“We’re very pleased with what came out of the House version. We included in there were animal health priorities, some additional funding for MAP and FMD to promote our product internationally, and then, of course, the tax package was included in there on things like 179, bonus depreciation and estate taxes,” he says. “We are very pleased those were in there even if some of our other assets we need to be in the farm bill weren’t able to make it in there.”

Humphreys says the House version of the reconciliation bill includes funding for animal health priorities, including $233 million per year on animal disease prevention and response.

What’s Not in the Bill?
According to Humphreys, there’s one major priority that didn’t make it into the Big Beautiful Bill — and that’s provisions for Prop 12.

“We still need a farm bill to address Proposition 12 in California. At the end of the day, this is an issue that, as California continues to regulate outside of their borders, is not just a pork industry issue. It is an American agriculture issue,” he says. “We’ve been asking — along with the American Farm Bureau, Corn, Soy and others — for Congress to address this issue of California regulating farmers outside of their borders. And we still need that to be addressed.”

Humphreys says a farm bill is still needed to address Proposition 12 in California. But if a farm bill doesn’t happen this year, Humphreys says NPPC is exploring other options to do it.

“Even though there are other solutions for Proposition 12 and other potential vehicles out there that we’ll continue to explore with our friends on the Hill, at the end of the day, we still believe as American pork producers that America and the pork industry need a farm bill — a skinny version, a large version or whatever. We need to maintain that coalition not just for now, but for decades to come as well. We’re not ready to give up on that yet,” Humphreys says.

Renewable Energy In The Bill
Energy programs are another area of focus under the reconciliation bill. According to AFBF, USDA’s farm energy and biofuel programs are reauthorized through 2031 to spur renewable energy innovation in rural America. That would include the Biobased Markets Program, which is a program that promotes biobased products through federal procurement. It also addresses the Bioenergy Program for Advanced Biofuels, which provides payments to producers of biodiesel, cellulosic ethanol and other next-generation fuels.

Tax Provisions That Would Benefit Ag

Farm CPA Paul Neiffer calls the tax provisions within the House version of the bill “very favorable for agriculture,” rating them a 8 or 9 out of 10. Here’s why:

As of Jan. 20, farmers will have 100% bonus depreciation for the next four years
The Section 199A deduction that was at the 20% level will now be bumped up to the 23% level.
Cooperative deductions will still be included
Starting next year, Section 179 will increase to $2.5 million, up from $1 million
An increase in the gift tax exemption amounts to $15 million per individual and $30 million per couple, adjusted for inflation annually.

Neiffer say farmers who’ve built net worth through land or other assets, there’s a piece of the legislation that will also benefit them.

“The lifetime exemption starting next year will be $15 million, and it’s made permanent,” Neiffer says.

Lower Interest Rates for Ag Producers?

If the bill passes, agricultural producers could also see lower interets rates for loans. According to Jeff T. Kanger, president of First State Bank in Lincoln, Nebraska, there’s another provision that will allow community banks to pass along lower interest rates to ag producers and rural housing.

“The community banks have less tax exposure and can therefore pass along some interest savings to customers,” Kanger told AgWeb. “This provision is very important to a lot of our growers.”

It’s called the “Exclusion of interest on loans secured by rural or agricultural real property.” According to the provision text, it “allows for a partial exclusion of interest on certain loans secured by rural or agricultural real estate. Speciﬁcally, it allows for the exclusion of 25 percent of interest received by a qualiﬁed lender on any qualiﬁed real estate loan.”

What’s Next?
The Senate could roll out its version of bill later this week, which is expected to include changes from the House’s version that passed in May by one vote.

House Speaker Mike Johnson also said this week he still believes July 4 is a realistic target for passing President Donald Trump’s “big beautiful bill.”

EXCLUSIVE: As DOGE Works to Stop Wasteful Spending, Secretary Rollins Says Vital Farm Programs Aren't at Risk

Thu, 20 Feb 2025 22:44:31 GMT

The Department of Government Efficiency (DOGE) has stormed Washington since President Donald Trump took office, working to uncover what it calls wasteful spending. That includes a comprehensive review of the money going out the door at USDA.

Before Agriculture Secretary Brooke Rollins was even confirmed, DOGE produced findings from its initial review of USDA. Those findings were something Rollins highlighted during her first address to more than 400 USDA staffers and others immediately following her confirmation.

“I welcome DOGE’s efforts at USDA because we know that its work makes us better, stronger, faster and more efficient. I will expect full access and transparency to DOGE in the days and weeks to come,” said Secretary Rollins during her address.

The American people gave us a mandate: end waste, fraud, and abuse in their government — and we are delivering.

🚨Here are just several contracts we terminated @USDA:

-Media contracts, including Politico subscriptions: $2.77 million

-Diversity, Equity, and Inclusion…
— Secretary Brooke Rollins (@SecRollins) February 15, 2025

According to Rollins, since Jan. 20, USDA has reviewed contracts, personnel, employee trainings and DEI programs. Based on that review, she announced USDA would terminated 78 contracts, which totaled more than $132 million, calling them “bold reforms.” That includes:

Media contracts, including Politico subscriptions: $2.77 million
Diversity, Equity and Inclusion Onboarding Specialist: $374,000
Diversity Dialogue Workshops: $254,000
International Development for Historically Underrepresented Communities: $298,000
Brazilian Forest and Gender Consultant: $229,000
Women and Forest Carbon Initiative Mentorship Program: $121,000

Today’s contract update:

95 cancellations with savings of ~$115M (ceiling value of ~$235M), including two USDA contracts:
- $265k for a “food and nutrition service 3 day leadership retreat in Atlanta”
- $30K for “Malaysia study tour facilitation services” pic.twitter.com/U5IMTpvPLe
— Department of Government Efficiency (@DOGE) February 21, 2025

Just a week later, DOGE posted an update saying the current update at USDA include:

95 cancellations with savings of ~$115M (ceiling value of ~$235M)
That includes two USDA contracts:
- - $265k for a “food and nutrition service 3 day leadership retreat in Atlanta”
- $30K for “Malaysia study tour facilitation services”

Live update from our @DOGE_USDA team’s meeting tonight 👇

Look what we just found (and cancelled!): $324,671 grant for “Increasing DEIA Programming for Integrated Pest Management” … you can’t make this up🤦🏻‍♀️

cc: @DOGE @elonmusk pic.twitter.com/GOaYpIeM13
— Secretary Brooke Rollins (@SecRollins) February 21, 2025

Secretary Rollins also providing an update Thursday, saying the agency canceled a $324,671 grant for “Increasing DEIA Programming for Integrated Pest Management.”

DOGE USDA
DOGE USDA took to X (formerly Twitter), seeking help and input from the public. That one post caused a flood of input, with more than 2,000 comments and suggestions. While some went as bold as asking DOGE USDA to abolish USDA reports, others asked DOGE to look into funding for solar on farmland and where the money has been spent to combat avian flu.

DOGE is seeking help from the public! Please DM this account with insights on finding and fixing waste, fraud and abuse relating to the US Department of Agriculture. Thank you.
— DOGE USDA (@DOGE_USDA) February 17, 2025

Are Farm Programs at Risk?

While farmers seem generally open to a USDA that wants to tackle waste, there’s also concern about what it could mean for crop insurance or other vital farm programs.

In an exclusive interview with Farm Journal during the 2025 Top Producer Summit , we asked Secretary Rollins how much push back she will have on DOGE and what assurances she can give producers that farm programs won’t be at risk.

“DOGE has brought, I think, a lot of excitement to all of America,” Rollins said. “I think there is not one person, except for maybe Elizabeth Warren and a few democrats ... everyone realizes at this moment in time in American history this is really important. Having said that, the United States Department of Agriculture, and since President Lincoln founded it in 1862, I believe, this agency is important to our farmers and ranchers with programs like the farm loans, etc., and imperative to a thriving rural America.”

Thank you @topproducermag for hosting @RogerMarshallMD and me in Kansas City, Missouri, with 1,000 of the Top Producers from across the US to talk about issues like expanding trade access and cutting regulatory red tape for farmers.

Biden’s ZERO trade deals and inflationary… pic.twitter.com/ejMxKxkRMG
— Secretary Brooke Rollins (@SecRollins) February 19, 2025

Rollins also pointed to President Trump’s approval rating within the rural community, as another reason this USDA will work to protect those programs.

“The farmers and the ranchers have been with him since he came down the escalator in 2015. I sincerely believe that those programs that are essential to keeping those communities thriving and hopefully even more prosperous going forward, that we’ll work with those to ensure that there is an understanding of how important those are,” said Rollins.

Checkoff Programs and DOGE
When DOGE took to X to ask for input, there were several comments about DOGE investigating agricultural checkoff programs. According to Pro Farmer Washington Correspondent Jim Wiesemeyer, DOGE is reportedly actively reviewing agricultural checkoff programs as part of its broader initiative to evaluate and potentially reform agricultural policy and spending.

AgriTalk’s Chip Flory asked Rollins if Checkoffs had become a target for DOGE.

“That is to be determined,” Rollins said. “I have not even begun to look at those. I know we’ve got a team looking at them. We’re going to get through the next few weeks and then we’ll start evaluating.

According to Wiesemeyer, USDA’s Agricultural Marketing Service oversees 22 checkoff programs, which vary in legal authority and regulatory structure. Some operate under commodity-specific statutes, while others fall under the Commodity Promotion, Research, and Information Act of 1996. State-level checkoff programs also exist, often independently from federal programs, covering commodities such as corn, rice, apples, and table grapes.

The Pros/Cons of Ag Checkoff Programs
Wiesmeyer reports agricultural checkoff programs provide collective marketing, research, and education benefits, but they also face criticism for transparency, fairness and mandatory participation.

Pros

Market development: Expands markets and funds large-scale advertising.
Research & innovation: Improves farming practices, technology, and sustainability.
Education & trust: Enhances consumer confidence in agricultural products.
Return on investment: Studies show benefits outweigh costs, with high benefit-to-cost ratios.

Cons

Transparency issues: Small farmers criticize unclear fund allocation.
Favoring large producers: Benefits may tilt towards larger operations.
Mandatory fees: Farmers must contribute, even if they disagree.
Potential misuse: Allegations of lobbying and mismanagement exist.
Harm to specialty producers: Organic farmers may not benefit but still pay.
Legal challenges: Constitutional disputes over mandatory participation.

Wiesemeyer reports while checkoff programs drive industry growth, concerns over equity and governance continue to spark debate and calls for reform.

Watch Rollins’ full interview with AgriTalk’s Chip Flory.

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USDA’s Rollins: ‘Let’s Go Barnstorm The World And Find New Partners’ For Trade

Do Tariffs Work? Leading Ag Economists Weigh In

Mon, 03 Feb 2025 17:00:00 GMT

Tariffs are a tool used by President Donald Trump during both his terms. But do they work? Not even ag economists are in alignment, as the answer seems to be: It depends.

This past weekend, Trump signed three executive orders for tariffs , the first time a president has used powers granted under the International Emergency Economic Powers Act of 1977. The orders also include retaliation clauses that would ramp up tariffs if the countries respond in kind. Trump cut the levy on imports of Canadian energy to 10%.

By Monday morning, Trump had agreed to delay tariffs on goods from Mexico for one month to allow more time for negotiations. The agreement happened just hours before the tariffs were set to take effect.

President Claudia Sheinbaum said U.S. tariffs against Mexico will be delayed for one month after a conversation with Trump on Monday. Trump then confirmed the news on Truth Social.

Which Input Could Be Impacted Most by Tariffs?

Tariffs on the U.S.'s top three trading partners could have a major impact on agriculture. The January Ag Economists’ Monthly Monitor asked economists which input is most at risk. The top answer was fertilizer.

Ag Economists’ Monthly Monitor

(Lindsey Pound)

“From a headline standpoint, it’s probably potash,” says Samuel Taylor, farm inputs analyst, Rabobank. “We get 85% to 90% of our potash from imports from the Canadian market. The residual is made up by Russia and Israel, in principle, with some other markets coming in.”

One day after Trump announced he would move ahead with planned tariffs, Prime Minister Justin Trudeau stated tariffs targeting $30 billion in American products, such as alcohol, produce, household goods and industrial materials, will roll out in two phases starting Feb. 4, the same day the U.S. tariffs are set to begin.

The tariffs on the other $125 billion worth of goods will come in 21 days to allow impacted Canadian companies to adjust their supply chains. Trudeau emphasized Canada’s response would be “strong but appropriate,” while also considering non-tariff measures such as restrictions on critical minerals.

Do Tariffs Work?

With tariffs and a potential trade war brewing that begs the question: Do tariffs work?

It’s something Farm Journal asked the nearly 70 ag economists part of the Farm Journal Ag Economists’ Monthly Monitor. The survey asked economists: “Do tariffs work in trade policy?” Economists views were mixed:

“Tariffs can work in trade policy — that’s why nations continue to use them. The complex part that extends beyond the tariff action is potential long-term repercussions that can result from trade flow changes.”
“In limited cases, typically only if they result in a policy response in the targeted country. Much of the time, tariffs are like cutting off one’s nose to spite one’s face.”
“Tariffs provide short-term gains but have always failed relative to free trade in the long term.”
“Absolutely, when properly applied.”
“Not over the long term. They tend to affect who gets to supply different markets around the world.”

The Ag Economists’ Monthly Monitor also asked: “When tariffs are used as a ‘tool’ in trade, who pays the tariff?” Not all economists were aligned on that answer either, saying sometimes it’s farmers and consumers, but it can also be the exporting countries.

“When the U.S. imposes tariffs on imports, importers in the U.S. pay taxes to the U.S. government on their purchases from abroad. When another nation imposes tariffs, importers in that nation pay import taxes to their government on their purchases from abroad. Often, when a tariff is implemented, another nation retaliates, and you end up with importers in both nations paying the price on whatever products the tariffs apply toward.”
“If an importing country places a tariff on the exporting country, producers in the exporting country and consumers in the importing country both lose (i.e., receive lower and higher prices, respectively). Conversely, producers in the importing country and consumers in the exporting country win (i.e., receive higher and lower prices, respectively).”
“In the short run, consumers who purchase goods with a tariff might see higher prices if the tariff is not absorbed elsewhere. In the long run, the tariff might result in changes to the supply chain that result in higher prices but also create other economic opportunities in America (e.g. reshoring of domestic manufacturing).”
“The correct economist answer is: It depends. Tariffs drive a wedge between prices in the exporting country and in the importing country. It depends on the circumstances of particular markets and how much is reflected in higher prices in the importing country and reduced prices in the exporting country.”
“Both the exporting nation and the importing consumer pay some portion of the tariff depending on who has more flexibility to adjust to trade barrier. If exporting countries can easily switch to supplying other markets, they won’t have to ‘pay.’ If consumers can easily find cheap substitute goods, they won’t have to pay.”

Stabenow Finally Releases Full Text of Senate Farm Bill; Here's What It Means for Agriculture

Mon, 18 Nov 2024 17:35:08 GMT

Stabenow unveiled 1,397-page details of her long-awaited farm bill Monday morning. This comes as early Sunday evening Pro Farmer broke the news that Senate Ag Chairwoman (D-Mich.) had briefed Democrats but not Republicans on her coming farm bill text, which was expected to be released Monday.

Stabenow said in a news release and summary of the bill , “The foundation of every successful farm bill is built on holding together the broad, bipartisan farm bill coalition. This is a strong bill that invests in all of agriculture, helps families put food on the table, supports rural prosperity, and holds that coalition together.”

BREAKING: Chairwoman @SenStabenow Introduces Rural Prosperity and Food Security Acthttps://t.co/qRunZlk6zj
— Senate Ag, Nutrition, & Forestry Committee Dems (@SenateAgDems) November 18, 2024

The Rural Prosperity and Food Security Act includes $39 billion in new resources “to keep farmers farming, families fed, and rural communities strong.” The bill builds on the proposal Stabenow released in May by investing new resources and including innovative, new ideas to deliver the assistance farmers need faster.

It provides farmers with the certainty of a 5-year farm bill and the immediate help they need to manage the urgent needs of the present. It doubles down on our commitment to rural communities, ensures that the Supplemental Nutrition Assistance Program (SNAP) keeps up with the realities of American life, and brings the historic investments in climate-smart conservation practices into the farm bill. These new investments include:

$20 billion to strengthen the farm safety net to support all of agriculture and establishes a permanent structure for disaster assistance so emergency relief reaches farmers faster;
$8.5 billion to help families make ends meet, put food on the table, and improve access to nutrition assistance;
$4.3 billion to improve quality of life in the rural communities that millions of Americans call home.”

Farm CPA Paul Neiffer has already combed through the bill, and says, “This is our first preview of the Senate Farm Bill Proposal. There appears to be some benefit to production Ag, however, many of the proposals seem to penalize production ag such as the following:

Very limited increase in base acres
Restriction on payments due to ownership of farmland by higher AGI individuals or entities
Reduction in AGI limits
No change to definition of farm income
Possible limit on PLC payments
Items that may benefit production ag include:
Permanent ERP (although this is a very messy program)
Partial advance payments of ARC and PLC
Automatic 2023 and 2024 ARC or PLC decisions”

Senate GOP Ag Committee Ranking Member Reacts

Senate Ag Committee ranking member John Boozman (R-Ark.) on X wrote: “An 11th hour partisan proposal released 415 days after the expiration of the current farm bill is insulting. America’s farmers deserve better.”

“An 11th hour partisan proposal released 415 days after the expiration of the current farm bill is insulting. America’s farmers deserve better.” RM @JohnBoozman
— Senate Ag Committee Republicans (@SenateAgGOP) November 18, 2024

Meanwhile, the National Pork Producers Council (NPPC) issued the following statement:

“Though America’s pork producers appreciate Chairwoman Stabenow’s efforts to publish Farm Bill text, this is simply not a viable bill, as it fails to provide a solution to California Prop. 12,” said NPPC President Lori Stevermer, a pork producer from Easton, Minn. “Pork producers have continually spoken up about the negative impacts of this issue, and it is a shame these conversations were disregarded.”

In May, NPPC secured 100 percent of pork producers’ priorities in the House Agriculture Committee-passed bipartisan 2024 Farm Bill. In June, producers once again secured all policy priorities in Senate Agriculture Committee Ranking Member John Boozman’s 2024 Farm Bill framework.

NPPC said it urges both chambers of Congress to swiftly consider and pass a Farm Bill this year that includes a fix to California Proposition 12, a state law that places arbitrary housing standards on the pork industry, creating uncertainty for pork producers as they look to continue their operations to the next generation.

Additional Impact on Agriculture from Farm CPA

In a post this morning, Paul Neiffer of Farm CPA Report included a quick preview of the items that jumped out at him relative to the farm bill details released by Stabenow.

Reference Prices: The House proposal raised reference prices by approximately 10-20%. The Senate proposal appears to raise reference prices by a flat 5% (rounded). Although it appears that Cotton only went up by 4% instead of 5%.
Increase in Base Acres
- Only underserved and disadvantaged farmers may increase base acres
- Based on average of 2018-2022 plantings
- Includes prevent planted acres
- Maximum increase of 160 acres per farm
- If disadvantage farmer does not farm acres during 2025-2029, then increased base acres are eliminated
- Special 2023 and 2024 ARC/PLC election
- Automatic election to be paid the highest amount for 2023 and 2024 crop year even if the farmer originally elected ARC or PLC.

Limit on PLC Payment: The maximum amount of payment for PLC will be 15% of the effective reference price. As example, assume a farmer has a PLC yield of 200 bushels for corn and the effective reference price is $4.30 and the final corn harvest price is $3.50. Under the old PLC rules, the farmer could receive 200 bushels times 80 cents per bushel or $160. Under this proposal, the farmer is limited to 65 cents or $130 per acre.
Partial PLC Payments: Instead of waiting until after October 1 to collect a PLC payment, the farmer, in certain situations may elect to receive up to 50% of the crop beginning February 1. This is based on firm projections by USDA that the final harvest price will be below the effective reference price. If USDA pays too much, then the farmer must pay it back.
Agricultural Risk Coverage: As expected, the Bill increases the guarantee from the current 86% to 88%, less than the 90% in the House Bill. However, not expected, the Bill increases the maximum payment to 12.50% of benchmark revenue, matching the House Bill and makes this retroactive to the 2024 crop. 2023 crop remains at 10%.
Partial ARC Payments: Provides same mechanism for partial payments as under PLC.
Increase to Marketing Loan Rates: For 2025 crops and subsequent years, the loan rate will be the lesser of 110% of current loan rates or an adjustment based on current input costs versus a five-year average.
Sugar Program: Increase sugar cane payment to 24 cents per pound for 2025-2029. Sugar beet growers will receive 136.5% of sugar cane payment rate.
Permanent ERP: Emergency Relief Program would be made permanent (at least until next farm bill). Payment limits of $500,000 for specialty crops and $250,000 for all other crops.
Terms appear similar to old ERP programs, but it does not mandate how USDA will administer it, etc. Also, no extra payment limit if you can prove you are a farmer. This may still be messy for CPAs to help farmers calculate their claim. Also, requires farmers to insure all acres.
Adjusted Gross Income (AGI) limits: AGI limits dropped from $900,000 to $700,000.
- Increases AGI limits to $1.5 million for specialty and high-value crops.
- What happens if a farmer grows both? The Bill does not address this, other than likely leave it up to USDA to come up with rules.
- Waiver of AGI rules available to economically distressed producer.
- It appears that no payments will be allowed if the land is owned by someone or an entity whose AGI is over $700,000. This means that a farmer who is cash renting that ground will not qualify for any payment on that ground. Under current rules and the House Farm Bill proposal, any farmer who is cash renting the ground and their AGI is under the limit will qualify for a payment. This is a major change and will create the law of unintended consequences. They seem to want to not have an incentive for wealthier individuals to purchase land since their high AGI will not qualify them for any payments but under current rules they get no payment anyway.

Increase in CCC Scoring: Section 1708 indicates that for purposes of CBO scoring, the restrictions on utilizing CCC funds shall be $6.7 billion per year for 2024-2033. The last scoring by CBO was $400 million per year.

CRP Rentals Limit Increased to $125,000 from current $50,000

Crop Insurance Changes: Increases subsidies for beginning and veteran farmers and ranchers to essentially match House proposal.
- Increases SCO to allow for payment at 88% instead of 86% of guarantee. House was at 90%.
- Increases premium subsidies.
Makes improvements to Whole Farm and Micro Farm insurance plans.

Comments:

Several contacts, asked to respond to Stabenow’s late farm bill details, used the same words: “Wow, finally, but too late.” Stabenow is departing Congress after this session ends, and veteran farm bill watchers say this late-entry farm bill is not a positive chapter in her long career. Most are asking why she chose today in releasing the details, and why she took a partisan approach in briefing about the matter.

Presidential Poll Results: How Farmers and Economists View Candidates' Impact on Agriculture

Thu, 10 Oct 2024 21:42:27 GMT

Nov. 5 — election day — is fast approaching. A few weeks ago, we asked which candidate do you believe will have a more positive impact on farming policy programs, trade, biofuels policies and inflation.

Based on 4,776 respondents, here are the results:

We also asked about the candidate’s impact on agriculture overall. Here’s that breakdown by state. Make note of the seven swing states, Georgia, Nevada, Wisconsin, Michigan, Arizona, Pennsylvania and North Carolina, outlined in black.

Farmer Rationale On Harris Vs. Trump

While various polls suggest Trump has a clear edge among rural voters and there’s significant support for Trump among farmers, Jim Wiesemeyer, Farm Journal Washington correspondent, is quick to remind the community is not uniform in its voting intentions, with policy preferences and personal values driving individual decisions.

In general terms, Wiesemeyer says farmers support Trump because they:

Believe Trump better understands rural America and agricultural issues
Are concerned about his trade policies and confrontation with China
Have concerns about border security and illegal immigration under the current Biden/Harris administration
Are of the opinion Trump will lower costs for farmers, especially related to energy
Oppose what they view as socialist or anti-American policies from Democrats

Farmers support Harris because they:

Back environmental policies and renewable energy
Approve of the Biden/Harris administration’s efforts to strengthen farm workers’ rights
Believe in Harris’ food and nutrition policies
Support Harris’ economic policies aimed at working-class Americans

Economists’ Views On Harris Vs. Trump

The September Ag Economists Monthly Monitor, a Farm Journal survey of nearly 70 ag economists, revealed a more mixed view of the presidential candidates’ impact on trade.

When asked if a Harris or Trump administration would help or hurt trade, the survey found the following:

“Farmers are definitely concerned about trade,” says Michael Langemeir, an agricultural economist from Purdue University who helps author the Purdue University/CME Group Ag Economy Barometer and is one of the economists surveyed by Farm Journal each month. “We don’t ask specific questions related to tariffs in the Ag Economy Barometer, but one question we do ask is if they expect exports to increase, decrease or stay the same? Really, this is the most pessimistic they’ve been for about five years with regard to trade.”

Tariffs are a tool both the former Trump administration and the current Biden/Harris administration have used.

During the first presidential debate, Trump didn’t waver from his staunch stance on tariffs and trade, reiterating his plan to use tariffs to protect U.S. industries and increase revenues. Trump reinforced his plan to impose a 10% tariff on all imported goods and a 60% tariff on goods from China.

During the debate, Harris stated tariffs are essentially a “sales tax” on American households. The Biden/Harris administration recently extended the Trump-era tariffs, while also imposing its own set of tariffs in May. Biden directed the U.S. Trade Representative to “increase tariffs under Section 301 of the Trade Act of 1974 on $18 billion of imports from China to protect American workers and businesses.”

“That’s why I get really worried when both candidates start talking about tariffs. It’s really uncharted waters, if you will. There’s already the perception we’re struggling a little bit with trade. As we enter these uncertain waters, we’re going to struggle more,” Langemeier explains.

Do Tariffs Work?

The controversy over tariffs and if they’re a good trade policy tool is long standing. The September Ag Economists’ Monthly Monitor asked economists: “Do tariffs work in trade policy?” Economists views were mixed:

“Tariffs can work in trade policy — that’s why nations continue to use them. The complex part that extends beyond the tariff action is potential long-term repercussions that can result from trade flow changes.”
“In limited cases, typically only if they result in a policy response in the targeted country. Much of the time, tariffs are like cutting off one’s nose to spite one’s face.”
“Tariffs provide short-term gains but have always failed relative to free trade in the long term.”
“Absolutely, when properly applied.”
“Not over the long term. They tend to affect who gets to supply different markets around the world.”

The September Ag Economists’ Monthly Monitor also asked: “When tariffs are used as a ‘tool’ in trade, who pays the tariff?” Not all economists were aligned on that answer either, saying sometimes it’s farmers and consumers, but it can also be the exporting countries.

“When the U.S. imposes tariffs on imports, importers in the U.S. pay taxes to the U.S. government on their purchases from abroad. When another nation imposes tariffs, importers in that nation pay import taxes to their government on their purchases from abroad. Often when a tariff is implemented, another nation retaliates, and you end up with importers in both nations paying the price on whatever products the tariffs apply toward.”
“If an importing country places a tariff on the exporting country, producers in the exporting country and consumers in the importing country both lose (i.e., receive lower and higher prices, respectively). Conversely, producers in the importing country and consumers in the exporting country win (i.e., receive higher and lower prices, respectively).”
“In the short run, consumers who purchase goods with a tariff might see higher prices if the tariff is not absorbed elsewhere. In the long run, the tariff might result in changes to the supply chain that result in higher prices but also create other economic opportunities in America (e.g. reshoring of domestic manufacturing).”
“The correct economist answer is ‘it depends.’ Tariffs drive a wedge between prices in the exporting country and in the importing country. It depends on the circumstances of particular markets and how much is reflected in higher prices in the importing country and reduced prices in the exporting country.”
“Both the exporting nation and the importing consumer pay some portion of the tariff depending on who has more flexibility to adjust to trade barrier. If exporting countries can easily switch to supplying other markets, they won’t have to ‘pay.’ If consumers can easily find cheap substitute goods, they won’t have to pay.

Trump Threatens Tariffs on Deere

During a policy roundtable in Smithton, Penn., organized by the Protecting America Initiative last month, Trump made significant statements regarding John Deere and its plans to move some production to Mexico. Trump threatened to impose a 200% tariff on John Deere products if the company proceeds with its plan to relocate some of its manufacturing operations to Mexico.

Farm Journal asked economists the likely outcome if Trump did follow through with tariffs. Here’s what they said:

Your Next Read: U.S. Agriculture Faces Growing Trade Deficit, USDA Projects a Record Ag Trade Deficit in 2024

Take Our Poll: 5 Questions Ahead of the Presidential Election

Fri, 13 Sep 2024 20:14:22 GMT

⁦Election day — Nov. 5 — is fewer than 60 days out.

Based on the presidential candidate’s responses to the American Farm Bureau Federation questionnaire , Jim Wiesemeyer, Farm Journal Washington correspondent, says Republican Donald Trump supports increasing commodity price supports, improving crop insurance and focusing on innovation to stay ahead of China. Trump also pledges to lower energy bills and end Biden’s net-zero emissions policies.

Democrat Kamala Harris highlights the Biden administration’s initiatives to protect small farmers from unfair competition, citing Trump’s previous proposals for deep cuts to critical farming programs.

We’d like to know which candidate you believe will have a more positive impact on the following:

farm policy programs
trade
biofuels policies
inflation
agriculture overall

If you have a moment, would you answer five quick questions? You can take the poll here.

There’s a lot of chatter about the presidential election. Let’s see what farm country has to say.

Your Next Read: Where Do Harris And Trump Stand On Ag Policy Issues?

3 Topics Producers Should be Tracking in the Farm Bill

Wed, 31 May 2023 15:23:48 GMT

It’s no secret that conservation and insurance will be heavy topics of discussion in ongoing farm bill debates this year. But it’s difficult to understand the exact role each title will play in legislation.

There might be some insight from House Ag Committee Chairman Glenn Thompson (R-Pa.).

“We don’t need to rewrite the entire farm bill,” Thompson says. “We’re comfortable with many parts of the 2018 bill and there aren’t many tweaks or changes, instead things we need to protect and invest in more.”

With Thompson’s words in tow, Kala Jenkins, Pinion ag consultant, and her colleague Bill Penn, Director of Farm Program Services, have carved out their own theories on what to expect in farm bill 2023.

Here’s a highlight of what they’re tracking as we move through the year.

1. Program Limitations with FSA

USDA defines a small farm as one that sees gross cash farm income under $250,000. According to the agency’s 2021 data, large farms—operations that gross more than $250,000—account for 85% of ag’s market value.

But these income brackets often leave small producers emptyhanded when it comes to disaster programs, according to Senator Chuck Grassley (R-IA).

“The 2018 Farm Bill was intentionally written to help the largest farmers receive sometimes millions of dollars of subsidies from the federal government each year,” Grassley said to USDA Secretary Tom Vilsack in a Senate Ag Committee hearing. “I’m asking that you would now work with me to stop this needless abuse of taxpayer dollars.”

Related story: Crop Insurance, Production Costs, ERP Among Key Topics at Senate Ag Farm Bill Hearing

Penn, who formerly served as USDA’s Assistant Deputy Administrator from 1985 to 1993, doesn’t see the aid differences as abuse and wants aid to go to the producers who make the biggest difference.

“Congressmen always like to talk about how 10% of the producers are getting 70% of the payments, but those 10% of growers are producing 85% of our supply,” Penn says. “If the goal of aid is to ensure America’s needs are met, we have to offer protections to those that put in the work.”

2. AGI Calculations

Adjusted gross income (AGI) is used to determine eligibility for disaster programs, through means testing.

Penn formerly served as USDA’s assistant deputy administrator from 1985 to 1993. He says in the 1980’s, disaster programs means testing was determined through gross receipts rather than AGI. Penn believes AGI is a better test for means testing than gross receipts because it is a “net income” number rather than a gross revenue number.

Related story: Paul Neiffer: PARP – Will You Get Anything?

However, in the recent WHIP+ and ERP Programs, USDA used AGI as a test to determine if someone was a farmer. In Penn’s view, gross receipts is a better measure of who is a farmer when compared to AGI.

“If a farmer has a bad disaster year, he might have a negative net income or AGI. But his wife, a schoolteacher who has a $70,000 positive, non-farm income would push them out of WHIP+ eligibility for increased limitations due to their AGI,” he says.

Penn says when the government is carving-out a disaster aid plan, it must be careful what question it is trying to answer with balance sheet numbers, or aid won’t be inclusive.

But, Penn is concerned if AGI limitations are applied to crop insurance.

3. Crop Insurance Coverage

In the past 20 years, the Federal Crop Insurance Program has covered an average of 87% of all U.S. croplands that were eligible for the program.

So, is a climate angle how crop insurance should be viewed? Jenkins isn’t convinced. She says the bottom line is in making programs voluntary.

“If we focus solely on climate and conservation in all our farm bill initiatives, could we miss something in the literature that could make certain practices mandatory instead of voluntary? That’s the concern we’re hearing from growers now.”

Related story: Commodity Programs Might See a 12% Cut in the Proposed $1 Trillion Farm Bill

Beyond conservation, Jenkins hears whispers of Title XI programs taking an entirely different direction in 2023.

“I’ve heard chatter about whether we need to change the way some of these programs work today, like whole farm crop insurance programs versus the noninsured crop disaster assistance program.” she says. “Then there are also some stakeholders questioning whether we need to link insurance to conservation, while others don’t want it to be the main focus. The needle is all over the board.”

What Do Americans Want to See in the 2023 Farm Bill?

Wed, 29 Mar 2023 20:24:36 GMT

American Farm Bureau Federation released a survey on Wednesday, which shows the majority of respondents agree that nutrition and risk management should be top funding priorities in the farm bill.

Historically, the nutrition title, including Supplemental Nutrition Assistance Funding (SNAP), takes the majority of the farm bill cake, as was seen in 2018 when nutrition made up 76% of the budget.

(Farm Journal)

The Congressional Budget Office, in its 10-year Budget and Economic Outlook , raised the cost estimate for SNAP by $93 billion over the next decade. Sen. Joni Ernst (R-IA) says this is where the greatest farm bill debate will take place.

“If you’re an able-bodied, single male with no children, then you should certainly be working and providing for yourself,” Ernst says. “We have to make sure those funds aren’t abused at the expense of the taxpayer while making sure those needy families do get the support they need.”

While nutrition programs have taken focus, inflation is top-of-mind for Americans.

Addressing Inflation

According to survey results, 86% of respondents are concerned about food inflation. And the issue didn’t go unnoticed by Rep. Austin Scott (R-Ga.) in a recent House Ag Committee hearing .

“I think everybody in America that is watching this is smart enough to recognize the volume of food, as we’ve seen with eggs, there are supply-and-demand issues there,” Scott said to Tom Vilsack, USDA secretary. “No matter how much you give somebody in SNAP benefits, the cost of groceries continues to go up…”

Scott attributes the inflation to “bad” policy, which leads to less food availability. He says food security starts in the farm safety net and program titles, not nutrition.

Risk Management

So, where will risk management fall in the farm bill debate if food insecurity is America’s second-largest concern? Sen. Chuck Grassley (R-IA) says he’s made a point to hold space for risk conversations, particularly insurance, in hearings.

“What we need to do is make sure the crop insurance program is kept as the most useful safety net tool for the family farmers—that’s 86,000 in Iowa, and over the country as a whole about 2% of our population are involved in ag, producing the food for the other 98%,” Grassley says. “And that 2% needs consideration, considering how important they are to the livelihood of everybody else.”

But there is a chance the insurance title could be “reworked” all together, according to Kala Jenkins, Pinion ag consultant.

“I’ve heard chatter about whether we need to change the way some of these programs work today, like whole farm crop insurance programs versus the noninsured crop disaster assistance program.” she says. “Then there are also some stakeholders questioning whether we need to link insurance to conservation, while others don’t want it to be the main focus. The needle is all over the board.”

What’s at Stake

With so much uncertainty in the farm bill arena, it begs the question of whether a farm bill will be passed in 2023. And most American’s understand what those repercussions would look like, even if they aren’t involved in ag.

When questioned about whether they think a farm bill passage or delay would impact the country, their state, community family and themselves, respondents forecast the biggest impact would be on the country and the smallest impact landing on themselves.

These results may have something to do with consumer’s trust in producers. According to the survey, 89% of adults trust farmers, which has remained steady since 2019.

“Almost nine in ten adults trust farmers, which will be important as we work to inform the 260 lawmakers who weren’t in Congress when the last farm bill was written,” says Zippy Duvall, AFBF president.

Is There Anything New from the Latest Farm Bill Debate?

Fri, 24 Mar 2023 15:13:05 GMT

This week we had a farm bill-related conference, a hearing and lots of talk about a new farm bill. But nothing really new surfaced after all that mostly noise. Here’s a quick recap.

Farm Bill Timing

Sen. John Boozman’s (R-Ark.) comment that he’s “feeling good” about the new farm bill’s timely passage was met with laughter from wonks and lobbyists attending a farm policy confab, those so-called “smart money” experts who are frequently wrong.

Upshot

Sen. John Thune (R-S.D.) in his presser this week accurately forecast that nothing new about the farm bill will likely surface until after the debt limit debate is completed (remember that ahead). That will take months to unfold.

We need to know the final funding level before there are any attempts to mix and match to get to a final bill/scoring. And Republicans must come to grips with the third rail of farm bills: don’t alter SNAP/food stamps with draconian language or funding reductions that will be defined by Democrats.

What Thune Knows and Apparently Many Others Do Not

On IRA dollars, remember that everyone agrees they cannot all be spent by September 30, 2031, when the new money dries up. So, it makes sense to use the money that cannot be spent anyway on other things.

Shifting Funding Around a Big Hurdle

Sen. Thune chatted about his farm bill priorities — including raising commodity reference prices and protecting crop insurance. Nothing new there. But when the conversation turned to conservation, and the almost $20 billion for climate-smart agriculture in Democrats’ party-line Inflation Reduction Act, Thune suggested Republicans might come for that pot of money.

Good luck having to deal with a farm bill leader veteran: Senate Ag Chair Debbie Stabenow (D-Mich.), who cheered the billions of dollars in climate-smart funds to cut down on farming’s carbon emissions.

“With these landmark investments, we are equipping farmers, foresters, and rural communities with the tools they need to be a part of the climate solution,” Stabenow said in August.

Bottom Line

A Democratic-controlled Senate is unlikely to relinquish that money. Thus, more funding is needed or a realization that the billions of dollars in ad hoc aid funded by taxpayers over the past several years must be reworked into the crop insurance program to make it more reflective of today’s agriculture. But that may take some tweaks that some key crop insurance users do not want.

Besides food stamps, crop insurance reform will be the big farm bill debate ahead. We heard little about that this week.

Commodity Programs Might See a 12% Cut in the Proposed $1 Trillion Farm Bill

Fri, 17 Feb 2023 19:59:17 GMT

The Congressional Budget Office unveiled its 10-year cost estimates (2024 to 2033) for existing farm bill programs on Wednesday, with a projected $1.5 trillion price tag, up from $867 billion in the 2018 farm bill.

Jim Wiesemeyer, Pro Farmer policy analyst, advises not to put too much weight in these estimates, as they are the reason the farm bill is out of date so soon after it is written.

“CBO’s farm bill forecasts are frequently well off the mark in either direction,” he says. “It’s a lot like USDA’s farm income projections in February for the year head. CBO looks out 10 years … good luck taking these forecasts too seriously.”

So, will this amount of money keep the programs ahead of their time? Some aren’t convinced. And it starts with the farm bill’s largest funded program—Supplemental Nutrition Assistance Program (SNAP).

SNAP Spending

Based on the 10-year period, SNAP spending is nearly 82% larger than what it was granted in the 2018 Farm Bill at $663 billion.

(Farm Journal)

A large portion of the increase is due to the administration’s re-evaluation of SNAP’s the Thrifty Food Plan (TFP), which resulted in a quarter-trillion-dollar increase in SNAP benefits from July 2021 to the May 2022 baseline.

In the most recent baseline, CBO increased its estimate of outlays for SNAP by $93 billion over the 2023–2032 period for “technical” reasons.

According to Sen. Boozman (R-AR), these reasons are rooted in “unacceptable” $250 billion spending by the USDA on TFP—which was supposed to have cost nothing—in the previous farm bill. Boozman made his sentiments known at a Senate Ag Committee farm bill hearing on nutrition on Thursday.

“Congress had no intention of your team spending that, and if you understood that was going to happen, you should have alerted Congress,” Boozman said to Cindy Long, USDA administrator. “How can we trust you going forward to give us advice? Spending a quarter of a trillion dollars from this committee is totally unacceptable.”

Related articles: How Long Does it Take to Write a Farm Bill?

While Boozman is adamant other program will suffer funding losses due to the “unsustainable” TFP increases in the coming bill, Senate Ag Committee Chairwoman Debbie Stabenow (D-Mich.) says that’s not the case.

“Whether commodity or SNAP programs go up or down, these monies aren’t traded. So, cutting SNAP won’t add money to the commodity title,” Stabenow says.

The 2018 bill enacted policy for a “thorough” farm bill update that hadn’t been done since 1975, according to Stabenow. She says the TFP increases fall under that update umbrella.

“The Trump administration chose not to use that [update and funding] because that was 2018—they chose not to proceed,” Stabenow rebutted. “The Biden administration came in and chose to proceed with those funds, and I’m glad they did.”

The General Accountability Office (GAO) has since determined USDA failed to submit the TFP food basket increase to Congress as a rule as required by the Congressional Review Act.

Row Crop Safety Net

Disaster programs such as the Market Facilitation Program (MFP), Coronavirus Food Assistance Program (CFAP), Wildfire and Hurricane Indemnity Program Plus (WHIP+) and Emergency Relief Program (ERP) saw billions of dollars moved from taxpayers to producers in the past 10 years, with USDA reporting the largest spike in 2020 at $45 billion.

According to estimates from the House Ag Committee, CBO’s 2023 baselines compared to the 2018 farm bill will cause changes over the five-year period in:
• Commodity programs—12% decrease
• Conservation—19% increase
• Nutrition—82% increase
• Crop insurance—26% increase

However, CBO’s latest baseline provides no built-in ad hoc for these programs.

“If Congress doesn’t provide more funding/investments for Title 1, it puts pressure on farm-state lawmakers to continue the billions in ad hoc aid,” Wiesemeyer says. “Some analysts say reforming Title I would mean spending far less than continuing ad hoc assistance. If Title I is not made more effective, farmers will keep wondering if Congress will fund more emergency aid.”

Related articles: The Cost of a Farm Bill: 2023 Row Crop Priorities

GAO released a report stating that those wanting to change crop insurance program features will try to use to their advantage.

Here are the changes GAO says Congress could make to mitigate the programs costs:

• Reduce subsidies to high-income participants by creating an income limit.
• Adjust compensation to insurance companies to better align with market rates.

Livestock Safety Net

Dairy and livestock did, however, receive a safety net mention in CBO’s baselines.

Under the Dairy Margin Coverage (DMC) program, CBO forecasts FY 2023 payments will total $194 million in FY 2023, with those increasing to $248 million in FY 2024 and $266 million in FY 2025. For the rest of the period—through FY 2033—they are forecast between $196 million and $265 million, for a total of $2.531 billion.

Livestock disaster payments are expected at $621 million in FY 2023 and forecast between $562 million to $591 million over FY 2024 to FY 2033, for a total of $6.333 billion.

Crop Insurance, Production Costs, ERP Among Key Topics at Senate Ag Farm Bill Hearing

Fri, 10 Feb 2023 21:00:25 GMT

A Senate Ag Committee hearing Thursday on the new farm bill raised a issue that is now evident: the Title 1 farm bill safety net can no longer deal with the current ag environment of rising production costs and relatively high prices for some commodities. USDA officials also faced criticism about its handling of Phase 2 payments via the Emergency Relief Program (ERP).

Other topics that have previously surfaced included Republican concerns about climate and conservation changes to crop insurance, while Democrats continued to urge expansion of the program to more producers.

Need for change

Senate Ag Chair Debbie Stabenow (D-Mich.) said the 2018 Farm Bill largely lived up to expectations, but she suggested its successor must deal with several challenges: increasingly damaging natural disasters and accelerated costs of production.

“There are still gaps in the farm safety net as farmers continue to face global market uncertainty and climate-fueled weather disasters,” she said. “While many commodity prices are at historic highs, which is good, we also know that land and fertilizer and input costs are also near record highs.”

Farm safety net gaps

Ranking Member John Boozman (R-Ark.) said a focus on boosting nutrition and climate programs has obscured the fact that farm safety net programs like Price Loss Coverage (PLC) are ill equipped to deal with the current situation.

Related articles: Stepped-Up Basis Leaning in Favor of Rural America on House Ways and Means Panel

“Prices for many of our major commodities would have to drop sharply before the current Title 1 Price Loss Coverage safety net would start to work,” Boozman said, noting corn prices would need to plummet 46% before PLC would provide enrolled farmers any assistance. “By the time corn prices fell that low, the significant damage would have already been done.”

Sen. Tommy Tuberville (R-Ala.) asked if USDA had looked at how the two safety net programs respond to inflation, such as adjusting reference prices — which trigger payments under the PLC program.

“I will tell you my legislative staff is always quick to tell me to emphasize that Congress writes the farm bill, and then that’s going to be important here too, obviously those reference prices are in statute,” USDA Undersecretary for Farm Production and Conservation Robert Bonnie told Tuberville. “When we talk to producers, there’s lots of concern about obviously rising input costs,” he added, but then emphasized USDA can only operate farm safety net programs as dictated by Congress.

USDA disaster aid implementation was both praised and criticized

Democrats and Republicans agreed with farmers who have complained about USDA’s methodology for payments under Phase 2 of the ERP, saying they do not adequately compensate farmers for their losses. “I appreciate USDA’s efforts through Phase 1 of ERP, which generally worked well in supporting producers with crop losses and [2020 and 2021],” said Sen John Thune (R-S.D.). “But the Phase 2 methodology… often does not accurately reflect crop losses that Congress meant to cover.”

Thune urged USDA consider reverting to the approach used in Phase 1 of the ERP effort for 2022 losses, a suggestion echoed by Sen. Amy Klobuchar (D-Minn.), who said farmers in her state “are grateful for the quick and effective approach taken during the implementation of ERP Phase 1,” but “a number of them have been less enthusiastic of the income tax-based approach taken during the rollout of ERP Phase 2.”

Bonnie said USDA’s approach on ERP Phase 2 focused on ensuring more producers had access to aid, but said if there are resources remaining after the effort the department may look at a shallow loss effort to address some of the concerns with Phase 2.

Related articles: The Cost of a Farm Bill: 2023 Row Crop Priorities

Bonnie said ad hoc programs like ERP have helped farmers facing disaster-related losses, but he stressed that federal crop insurance remains a key risk management tool, and that USDA has worked to expand the program to cover more producers.

Crop insurance and climate intersect

Boozman again raised a concern voiced by many Republicans about any move to use crop insurance to incentivize climate or conservation practices — which GOP members contend could undermine the actuarial soundness of the program and move it away from its core focus as a risk management tool.

“Can you commit to making sure that any efforts to expand the crop insurance programs are science based, peer reviewed, and protect the integrity of the program,” he asked Bonnie, saying a “one-size fits all” approach that elevates certain practices like cover cropping could disadvantage farmers in areas where those practices are not practical.

Bonnie responded that “with respect to crop insurance, everything we have to do has to be actuarially sound as we’ve got to maintain the integrity of crop insurance.” He said recent incentives offered to farmers for cover cropping have taken the form of premium rebates — not changes to premiums or the overall premium subsidy paid by the government.

Stabenow praised federal crop insurance, calling it “the number one risk management tool for producers.” However, improvements are needed, she said, promising improvements to the program, “including specialty crop growers, organic producers, beginning and diversified farmers.”

Regarding prevent plant coverage

Sen. Ben Ray Lujan (D-N.M.) asked if USDA was looking at expanding prevented plant coverage under crop insurance, which pays farmers when they are unable to plant an insured crop due to extreme weathers. He noted eligibility currently hinges on a farmer being able to plant, insure and harvest crops in one of the four preceding crop years — known as the four-in-one rule — and some farmers in the West are at more risk of losing coverage due to prolonged drought conditions.

“One in four is very regionalized in a lot of cases,” acknowledged USDA Administrator Marcia Bunger. “So, for this coming year, we’ve made an exception for several western states to step outside of that one and four,” adding USDA would consult with stakeholders over the next year about a potential long-term solution to the issue.

Related articles: How USDA’s $2.8 Billion Climate-Smart Investment Might Impact Your Operation

USDA climate program efforts were raised by Sen. Chuck Grassley (R-Iowa), who noted concern over USDA’s move to tap more than $3 billion from the Commodity Credit Corporation (CCC) to fund its Partnerships for Climate-Smart Commodities (PCSC) effort that funds climate-smart ag pilot projects.

“Spending over $3 billion without input from Congress is a serious concern for everybody in the Congress,” Grassley stated.

Grassley then asked Bonnie if USDA had any plans to tap CCC for additional USDA programs. Bonnie reiterated what USDA Secretary Tom Vilsack has said — that PCSC falls within the CCC’s charter as it looks to expand and create new markets for ag commodities.

However, Bonnie ultimately said there were no plans for new CCC-backed programs under the Farm Production and Conservation (FPAC) mission area.

How the $1.7 Trillion Omnibus Spending Package Might Impact Your Operation

Tue, 20 Dec 2022 17:19:29 GMT

Text of the $1.7 trillion omnibus spending package was released early Tuesday morning. The Senate will vote first and intends to pass the measure before Thursday, leaving the House no time to demand changes before the Christmas holiday.

Here are the details that might impact your farm:

Disaster Relief

• $250 million in aid to rice producers and $100 million to cotton merchandisers to make up for losses related to the pandemic or supply chain disruptions. USDA previously provided $80 million in aid to textile mills and other cotton users. For rice, USDA would determine payment rates based on yield history and acreage.

• $40.6 billion for drought, hurricanes, flooding, wildfire, natural disasters and other matters — $3.7 billion in disaster aid for farmers to cover 2022 crop and livestock losses.

Food Aid

• Funds two programs that provide foreign food aid. These include the Food for Peace Program (PL 480), which is funded at $1.8 billion, and the McGovern-Dole International Food for Education Program, which is funded at $248 million, for an increase of $11 million over fiscal year 2022.

• Summer Meals Program Modernization: Updates the summer food service program to permanently allow states to provide non-congregate meals and summer electronic benefit (EBT) options nationwide to eligible children in addition to meals provided at congregate feeding sites. Non-congregate meals, such as grab-and-go or home delivery, would be provided in rural areas to eligible children, and summer EBT benefits would be capped at $40 per child per month. This provision is fully offset and based largely on the Hunger-Free Summer for Kids Act, which Boozman authored and introduced earlier this Congress.

• Supplemental Nutrition Assistance Program (SNAP) EBT Skimming Regulations and Reimbursement: Requires USDA to coordinate with relevant agencies and stakeholders to investigate reports of stolen SNAP benefits through card skimming, cloning and other similar fraudulent methods. This provision aims to identify the extent of the problem, develop methods to prevent fraud and improve security measures, and provide replacement of benefits stolen through these fraudulent actions.

Conservation

• Cracks down on “conservation easements,” which allow tax breaks when land is dedicated for conservation purposes. The IRS has identified the transactions as a method for avoiding taxes. The conservation easement provision was expected to raise between $6 billion and $7 billion.

• SUSTAINS Act: Enacts a House bill that allows corporations and other private entities to contribute funding for conservation projects and authorizes USDA to match up to 75% in matching the donations.

Inputs

• Pesticide Registration Improvement Act (PRIA 5) Reauthorization: Reauthorizes pesticide registration and review process user-fee programs administered by the Environmental Protection Agency (EPA) and increases registration and maintenance fees to support a more predictable regulatory process, create additional process improvements, and provide resources for safety, training, bilingual labeling, and other services to advance the safe and effective use of pesticides.

• Pesticide Registration Review Deadline Extension: Extends deadline for EPA to complete registration review decisions for all pesticide products registered as of October 1, 2007. EPA is facing a significant backlog of pesticide registrations due to a variety of factors over the past several years, which raises potential implications for continued access to numerous crop protection tools. The agency will be allowed to continue its registration review work through October 1, 2026, as a result of this extension.

Climate

• Growing Climate Solutions Act: Incorporates updated language from the Growing Climate Solutions Act, which directs USDA to establish a program to register entities that provide technical assistance and verification for farmers, ranchers and foresters who participate in voluntary carbon markets with the goal of providing information and confidence to producers.

Farm Business

• $1.92 billion for farm programs, which is $55 million above the fiscal year 2022 enacted level. This includes $61 million to resolve ownership and succession of farmland issues, also known as heirs’ property issues. This funding will continue support for various farm, conservation, and emergency loan programs, and help American farmers and ranchers. It will also meet estimates of demand for farm loan programs.

• Funding for specialty crops and remarks on crop insurance/A&O. Some $25 million is being made available for specialty crop equitable relief and report language directing USDA to use its legal authority to index all A&O (crop insurance program) for inflation and provide equitable relief for specialty crops going forward.

Livestock

• Livestock Mandatory Reporting Extension (LMR) Extension: Extends livestock mandatory reporting requirements until September 30, 2023. LMR requires meat packers and importers to report the prices they pay for cattle, hogs, and sheep purchased for slaughter and prices received for meats derived from such species to USDA who then publishes daily, weekly, and monthly public reports detailing these transactions.

Markets

• Commodity Futures Trading Commission (CFTC) Whistleblower Program Extension: Enables CFTC to continue payment of salaries, customer education initiatives and non-awards expenses related to the whistleblower program to ensure it can continue to function even when awards obligated to whistleblowers exceed the program fund’s balance at the time of distribution.

Some ag sector items that did NOT make the omnibus package:

Nothing for the proposed farmworker labor reforms from Sen. Michael Bennet (D-Colo.) and others. The bill also left out legislation to reform cattle markets or appoint a special investigator at USDA to investigate possible anti-competitive behavior in the meatpacking sector.

We’ll be updating this article as more details become available.

More on policy :

Water Resources Bill Reauthorized with a Component that Will Impact Producers
European Union Clinches a Deal on a Carbon Border Tax
U.S.'s “Candid” GMO Corn Conversation With Mexico Results In Changes To Looming Trade Dispute
Senate Clears Annual Defense Policy, Pushing $858 Billion to Military

Rep. G.T. Thompson Lists His 3 Farm Bill Objectives

Tue, 22 Nov 2022 23:44:15 GMT

GOP took the House by a slim margin last week, leading to a divided government as Democrats won majority in the Senate.

Rep. G.T. Thompson (R-Pa.) is gearing up to replace Rep. David Scott (D-Ga.) as the House Ag Committee chairman in Jan. With his new title in tow, Thompson will be working alongside current Senate Ag Committee Chairwoman Debbie Stabenow (D-Mich.) to finalize the passage of a farm bill in 2023.

As the New Year approaches, Thompson shared his highest priority farm bill objectives in a recent episode of AgriTalk with Host Chip Flory:

1. Internet Access

Signed into action in November 2021, the Bipartisan Infrastructure Law dedicated $759 million to deploy the ReConnect rural broadband program. The program aims to provide internet access to rural areas and “build brighter futures”, according to USDA Secretary Tom Vilsack.

Thompson, however, isn’t convinced this funding will fill the broadband void and plans to make it a legislative priority.

“Rural broadband is still the No. 1 needed utility that we have infrastructure needs for in this country,” Thompson says. “The only option to change that need is to do our jobs.”

Thompson is carrying that same “get it done” attitude into the insurance front.

2. Crop Insurance

Crop insurance can use some improvements in 2023, according to Thompson. He says this is an ongoing issue that can’t wait another five years.

“What are we supposed to do with reference prices and no margins in Title 1?” Thompson says. “We have to protect crop insurance by learning from our disaster experiences and improve it.”

While Thompson says time is of the essence in crop insurance, some feel time is the main factor underlining the whole farm bill due to the divided government.

3. Passage

Jim Wiesemeyer, Pro Farmer policy analyst, says there’s speculation the House will run out of time on the farm bill in 2023, because of the need for hearings and to gear up new members and staff on the “complexities” of farm policy.

When asked about timelines and expirations, Thompson reiterated the committee will need to work in a “very intense” way in order to prevent the legislation from expiring and “kicking the can down the road.” To avoid any delays, Thompson reiterated his urgency and drive for bipartisanship is his “commitment.”

According to Wiesemeyer, Thompson will likely meet this goal by pushing farm bill action and policy changes the moment offices change hands in January.

More on farm bill 2023:

Impact of the Elections on Farm Bill 2023
‘Red Wave’ of Voters Did Not Happen: Why Were Poll Predictions So Far Off the Mark?
As Hearings for the Farm Bill Ratchet Up, You can Do 3 Things to Help Agriculture

Setting the Farm Bill Stage

Thu, 23 Dec 2021 17:35:50 GMT

COVID-19 Pandemic and Fallout

Supply chain disruptions will likely steal the limelight, says Jonathan Coppess, University of Illinois professor.
Pandemic challenges could change future policy decisions, says Pat Westhoff, director of the Food and Agricultural Policy Research Institute at the University of Missouri.

“The question is if we write policies to handle any similar emergency in the future,” he says. “Or we choose what was done this time, where we make policies on the fly.”

Political Turbulence

Elections need to be center stage when considering farm bill outcomes, Westhoff says: “If we have a Republican House and Senate, those implications would be very different compared to Democratic control of both chambers of Congress.”

Coppess agrees. “The current political polarization really amplifies the uncertainty about how the farm bill is going to unfold,” he says.

Climate Focus

Wildfires, storms, drought and intense weather events due to climate shift will be the “single biggest driving influence” in policy debates, Coppess predicts. He says climate mitigation and prevention will likely translate into emergency disaster assistance, crop insurance and farm programs in 2023 and beyond.