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US Farm Bill: Who Won and Who Lost?

US Farm Bill: Who Won and Who Lost?

30 April 2012

ANALYSIS - The US Senate Committee on Agriculture's approval of the Agriculture Reform, Food and Jobs Act of 2012, also known as the 2012 US Farm Bill, finally gives the industry a chance to see what's been cut and what has survived the first round, writes Sarah Mikesell, TheCropSite senior editor.

With the current US budget situation, significant reductions were expected, but now it's time to see which programs fared better than others.

NCC "Deeply Concerned" about Peanut, Rice Provisions

The National Cotton Council (NCC) is deeply concerned that the legislation reported by the Committee does not include program choices that meet the needs of rice and peanut growers.

"The NCC is committed to continue to work with those growers and their organizations to successfully modify the legislation before it reaches the Senate floor vote to ensure that Sunbelt farmers get the much-needed economic benefit of an adequate safety net," said NCC Chairman Chuck Coley. "While it is important for cotton to have a workable program, many of our growers also rely on peanuts, rice and other crops for their livelihood and need viable cropping options."

Coley said the US cotton industry also has concerns with provisions regarding new lower payment limits, a significantly lower Adjusted Gross Income eligibility test, and changes to the actively engaged in farming provisions used to determine eligibility for revenue and loan programs.

Despite the NCC's concerns, Coley also noted that the initial Farm Bill draft will provide US cotton producers with risk management tools that can provide support when conditions occur that are beyond the growers' control.

"We need some certainty and predictability regarding farm programs," Coley said.

The improvements to crop insurance including making enterprise units with irrigated and non-irrigated provisions permanent and the establishment of a new Supplemental Coverage Option also will provide important risk management options for cotton growers.

Extension of the extra-long staple cotton loan and competitiveness provisions are important to Western cotton growers, he said. He also pointed to the legislation's inclusion of significant modifications to the upland cotton marketing loan and GSM-102, "that should serve to empower the Administration to be more resolute and determined in future efforts to successfully resolve the long-standing Brazil WTO case and eliminate the threat of retaliation."

Conservation Cuts Too Deep

One Wisconsin Congressman is not happy that the Farm Bill mark-up slashes the current level of support for conservation programs by $6.3 billion.

"These programs are vital to our family farmers and our clean water supply," said Rep. Ron Kind. "In addition, many state economies rely heavily on outdoor conservation and tourism. This is the wrong time to be making these drastic cuts to conservation."

Conservation funding supports incentive-based land and water programs to help reduce sediment flow that would otherwise pollute our rivers and streams, and is vital to helping farmers be good stewards of the land. Today, more than half of the farmers applying for conservation programs are turned away due to inadequate funding.

"Clearly the farm bill needs reform, but deep cuts to conservation programs are not the answer," Kind said. "There is waste to be found - including the billions of dollars in farm subsidies supporting few but very large agribusinesses or the taxpayer funds going to subsidize Brazil's cotton industry. We've got to weigh our priorities here and ensure a smart farm and food bill for the 21st century."

Energy Programs Continue

An amendment adopted into the Farm Bill would add some $800 million in mandatory funding to energy title programs, which supporters say would encourage advanced biofuels production in rural areas as well as promote other renewable energy programs.

The Advanced Ethanol Council (AEC) is pleased that the Farm Bill assures continued mandatory funding for USDA energy title programs, noting their opinion that there is no more urgent need in this country than creating new jobs and reducing our dependence on foreign oil.

"The programs will continue to help the United States create jobs and replace foreign oil with homegrown, renewable energy production when signed into law," the AEC said. "While it is very important to also address the tax piece for advanced biofuels by the end of the year, this is a critical first step toward providing continuity for American farmers and advanced biofuel producers while exceeding the committee's goals for deficit reduction."

Serves Needs of Soybean Growers

The American Soybean Association said they are pleased with the first draft of the Farm Bill process, noting that is will serve the needs not only of soybean farmers, but of the entire farming community.

"ASA is encouraged that the bill includes a revenue-based risk management program that is equitable between crops, and will partially offset losses incurred at either the farm level or the county level," said ASA President Steve Wellman. "Other key features of the bill include its consolidation of multiple conservation programs, targeting of conservation funding toward conservation measures on working lands versus land retirement, authorization and funding for the new Foundation for Food and Agriculture, full funding of the Foreign Market Development Program (Cooperator) and Market Access Program (MAP), and mandatory funding for ASA's two Energy Title priorities, the Biobased Market Program and the Biodiesel Education Program."

Not Perfect but Consistent with NCGA Policy

The National Corn Growers Association (NCGA) noted their appreciation to the Senate Agriculture Committee's efforts.

"While no legislative product is perfect, we believe the bulk of the legislation passed by the committee is consistent with corn growers' policy," said NCGA President Garry Niemeyer. "We look forward to working with Senate Ag Committee members and the entire Senate to get a bill passed on the floor in the month of May."

Ag Agrees - They've Done Their Share

Regardless of which side of the fence they sit on, commodity groups consistently said that critics should take note that agriculture has stepped up and made a more than proportionate contribution to deficit reduction. Now it's others turn to follow their lead.

As it stands now, current cuts should account for $23 billion in savings over 10 years.

Just the Beginning of Process

Don't forget that this is draft farm bill. It must now be considered by the full Senate, then reconciled with a House version of the bill, which must be passed by the House Agriculture Committee and the full House and signed by the President.

Much discussion and maneuvering for programs will be next as commodity groups and politicians lobby for changes.

Further Reading

You can view the 2012 US Farm Bill by clicking here.
You can read more 2012 US Farm Bill coverage by clicking here.

Sarah Mikesell, Senior Editor

Sarah Mikesell, Senior Editor

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