Farm economy, commodity prices could mean earlier push for 2018 farm Bill
December 12, 2016
National agriculture commodity groups have differing opinions about the next farm bill, but a couple of legislative leaders hope to push it through a year earlier than planned.
U.S. House Agriculture Committee ranking member Collin Peterson, D-Minn., fears the farm economy may reach "crisis proportions." Peterson said the only option left for Congress is to enact the 2018 farm bill one year ahead of schedule. The current farm bill expires Sept. 30, 2018.
In Minnesota there is a $3.8 billion dairy industry and Peterson has said that changes to the bill's commodity title and dairy program need to be made. Low commodity prices have fueled the sharpest drop in farm income in more than a decade, he said, and credit conditions are tougher because of that. According to the U.S. Department of Agriculture, farm profits are expected to plummet to $71.5 billion this year from $123 billion in 2013. Southern states are taking the biggest hit, according to federal figures.
Peterson's communications director, Liz Friedlander, said Senate Ag Committee Chairman Pat Roberts, R-Kan., also has publicly said he hopes to see a farm bill materialize in 2017. In a hearing held in September, Roberts said farmers and ranchers are worried and the regulatory framework in place today is "vast, confusing and often counterproductive."
"The next farm bill must provide risk management tools that are straightforward, market-orientated and defendable," Roberts said.
Peterson expressed concern about the lack of extra money for disaster assistance packages. He harbors concerns about the bad news that might find farmers this winter. In a radio interview, Peterson said producers will likely find out from bankers that they're not going to be able to get financing next year.
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"You know, $2.80 corn is not going to make it. You've got guys who've contracted some of their crops, so I don't know exactly how bad it'll be, but some people told me they think it's going to be ugly come this winter," Peterson said. "Rather than have some short-term deal, if we're going to have problems, then we need to make adjustments to the farm bill. We're going to start hearings in January anyway."
Gordon Stoner, a wheat grower from Montana who serves as president of the National Association of Wheat Growers, said the No. 1 priority for wheat growers across the country is crop insurance.
"In today's high volatility markets and the amount of money we put in crops, they need to be able to manage their risk," Stoner said.
Stoner said the next farm bill will be "evolutionary" and leaders should not be "tinkering" with what exists, but start fresh with a new program. He also favors speeding up the pace of piecing together the next farm bill.
"If prices continue as they have been, the baseline cost of the program is going to go way up. If we did it a year early, for scoring purposes, it would be less costly," Stoner said. "But we haven't done a farm bill on time in recent memory and to think we could get it done a year early, well, that makes me smile."
Jennifer Myers with the National Corn Growers Association said the association is focused on the current farm bill, which included major reforms that the association has deemed "very successful." The corn growers association is not wanting to reopen the farm bill, she said, nor start early on the next one.
"There have been a few kinks during the implementation phase and we're focused on getting those kinks ironed out. We are opposed to reopening the current farm bill and accelerating the next farm bill process," she said. "NCGA looks forward to working together with the new administration and congress as partners to build new demand for our agricultural commodities and advance issues important to corn farmers and agriculture generally."
Dustin Baker, deputy director, economics and domestic production issues for the National Pork Producers Council, said the group has a farm bill task force that includes growers and other members of the pork industry who will be meeting in January to set priorities for the group.
"Our priorities usually revolve around maintaining and strengthening competitiveness and reducing the cost of production, providing sound risk management tools for producers and this year, there will be a focus on increasing basic agriculture research funding," Baker said.
Baker said there are improvements that could be made to the farm bill and the NPPC would be open to moving up the schedule for drafting a new one.
"But there's an awful lot of players at the table and that may be a heavy task to do it early, but we're open to it," Baker said. "However, we also don't want to get it done early just to say we got it done early. We want something workable for our producers and don't want to sacrifice quality. Last time around, we were able to get some important provisions included in the farm bill that we were happy with, but there's always improvements to be made."
Colin Woodall Sr., vice president of government affairs for the National Cattlemen's Beef Association, said the next farm bill must include a strong research title to ensure that beef producers remain efficient and competitive in producing beef.
"We also need a robust animal health program including a foot and mouth disease vaccine bank to respond to any potential outbreaks, as well as a strong conservation title to protect programs like EQIP (Environmental Quality Incentives Program) that have been very successful in helping producers do even more to protect our resources," Woodall said.
Keith Williams with the National Turkey Federation said it's important for not just poultry producers, but all producers to have foreign zoonotic disease prevention built into the farm bill.
John Gordley, director of the American Soybean Association's Washington, D.C., office, said the 2014 farm bill boosted soybeans to a level playing field with other commodities. The soybean industry has had a competitive ARC-CO (Agriculture Risk Coverage-County) program, too, to rely on. He said the farm bill has supported soybean income as prices have fallen over the past several years.
"When it comes to the next farm bill, we would like to see corrections or adjustments in the current bill rather than starting from scratch, which can be time consuming, confusing and you end up devising something that's more expensive than what you can afford," Gordley said. ❖