Agricultural News

Senate Farm Bill 2012 Draft; Policy Issues

By Keith Good – Farm Policy – April 23, 2012

Farm Bill: Senate Ag Committee Farm Bill Draft. Ag Policy Editor Chris Clayton reported on Friday that, “Farmers will have to choose between a commodity program based on their individual farm or one that factors in countywide yield and income. “Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., on Friday released a 900-page ‘chairman’s mark’ of the farm bill for the full committee to debate or amend. The committee is set to meet on Wednesday to consider the legislation. “The Senate bill is expected to save $23 billion over 10 years compared to the baseline spending on the current farm and food programs. Stabenow’s bill would eliminate direct and counter-cyclical payments, as well as the Average Crop Revenue Election program, or ACRE. Lawmakers were pushing for farm-program changes that would score at least $15 billion in budget savings over 10 years.”

Mr. Clayton explained that, “The bill sticks with the ‘Agriculture Risk Coverage’ [ARC] program language crafted for the supercommittee last fall. Farmers would have to make a one-time choice between enrolling for individual coverage or countywide coverage under ARC. Friday’s DTN article pointed out that, “For a farmer signing up for individual coverage, the crop revenue will be compared to the Olympic five-year average individual yield for that commodity on the producer’s farm. In an Olympic average, the high and low years are excluded. “Those averages would then be matched with either an Olympic five-year national marketing price for a commodity or the marketing-loan rate, whichever is higher. “Once the payment rate is determined, the rate is multiplied by 60% of eligible acres for the commodity. For prevented planting, a 45% calculation will be factored.” Mr. Clayton included an alternative explanation for countywide coverage.  The DTN article stated: “Farmers who take the county option would have their crop revenue compared to the Olympic five-year county average yield. The eligible acres covered would rise to 75% for planted acres and remain at 45% for prevented acres. “Under county coverage, all acres planted or prevented from being planted would be covered on a farm. However, for most farmers, the total acreage would not exceed total acres a farmer had for the years 2009 through the 2012 crop year. There would be an opportunity to add acres, such as when land comes out of the Conservation Reserve Program.”

Daniel Looker reported on Friday at that, “The bill to reauthorize farm programs through 2017 keeps nonrecourse marketing loans. But for nearly all commodities, at the same level as in 2008. That’s $2.95 a bushel for wheat, $1.95 a bushel for corn, $6.50 a bushel for long grain and medium grain rice and $5 a bushel for soybeans. Rice farmers had been seeking a higher loan rate.”

Mr. Looker noted that, “The [ARC] program takes a bite out of potential payments several ways: “First, the [ARC] guarantee offered by the farm bill would be 89% of that average benchmark revenue. “The second limit is the payment rate. Each year’s crop revenue will be calculated by yields times the mid-season price for that commodity. Payments are made if that revenue falls below the guarantee, but they can’t be bigger than 10% of the benchmark revenue. “The third limit is the amount of eligible acres of the covered commodity. If you sign up for county-wide coverage, payments are made on 75% of your acres. If you sign up for the individual level, payments are on 60% of your acres.”

Reuters writer Charles Abbott reported on Friday that, “The Senate bill would give cotton its own revenue plan as part of the federally subsidized crop insurance program, in a step to resolve a World Trade Organization ruling against U.S. cotton subsidies.” Mr. Abbott pointed out that, “The Senate bill would cut conservation by 10 percent and crop subsidy outlays by 19 percent and shave public nutrition programs by $4 billion.  Together, it would be the largest farm-bill cuts in a generation.”

The Associated Press reported on Friday that, “Most difficult will be narrowing the gap between the Democratic Senate and House Republicans taking aim at the food stamp program that comprises some 80 percent of the bill’s spending;” while Erik Wasson noted on Friday at The Hill’s On the Money Blog that, “The bill also includes cuts to food stamps favored by the GOP. It strengthens requirements on education and stops liquor stores and tobacco shops from accepting food stamps.”

Ron Nixon reported on Friday at the Caucus Blog (New York Times) that, “The full committee is to vote next week on the bill, which also combines several conservation programs, stops lottery and gambling winners from getting nutritional assistance and helps family farmers sell locally by increasing support for farmers’ markets.”

The National Association of Conservation Districts (NACD) indicated that, “[NACD] applauds leaders of the Senate Agriculture Committee for recognizing the significant value of conservation in supporting America’s long-term environmental and economic stability. In language released in the Title II framework today, Agriculture Committee leadership demonstrated strong bipartisan support for locally-led conservation efforts.”

The Oklahoma Association of Conservation Districts (OACD) stated that, “Leaders of the [OACD] today voiced their support for the Conservation Title contained in the proposed version of the Farm Bill released today by Senator Debbie Stabenow, Chair of the Senate Agriculture Committee. According to Joe Parker, President of OACD, the language in the proposed farm bill would continue providing farmers and ranchers the tools they need to practice good conservation on the land.”

Meanwhile, the Agricultural Leaders of Michigan “hailed the draft of the 2012 Farm Bill released today and praised Sen. Debbie Stabenow for her leadership in crafting the proposal, which protects programs essential to agriculture, family farms, rural development and jobs. ALM applauded Stabenow for working across the aisle and with the agriculture sector at every stage of the Farm Bill update.”

Vicki Escarra, President and CEO of Feeding America noted Friday that, “Feeding America is deeply disappointed that the Senate Agriculture Committee proposes to  cut [SNAP] when the need for food assistance remains at unprecedented levels.”

Eric Munoz, Policy Advisor for Oxfam America noted Friday that, “This proposal takes important steps to cut waste and modernize America’s international food aid programs.”

Craig Cox, Senior Vice President for Agriculture and Natural Resources, Environmental Working Group (EWG) stated Friday that, “EWG is disappointed that the Committee failed to address the impact of fence-row to fence-row agricultural production, which is putting unprecedented pressure on our land, water and wildlife.”