Rice Farming

 - USA Rice Federation Update -

Agriculture budget proposal
targets farm families

By Reece Langley
VP, Government Affairs
USA Rice Federation

The USA Rice Federation continues to urge Congress to stand by its promise made to American farm and ranch families in the form of the Food, Conservation and Energy Act of 2008 (the Farm Bill) and oppose any further cuts to the safety net. The Farm Bill is less than a year old and not even fully implemented and already contains cuts in the direct payment program, payment limitations and crop insurance.

Moreover, the regulations to carry out the law’s strict new payment limitations and eligibility provisions, published on Dec. 29, significantly exceed statutory requirements and congressional intent.

Current and proposed agricultural policies are compounding the already extreme anxiety felt throughout farm country. These anxious feelings are a result of the economic crisis, turbulence in commodity prices and production costs, weather-related production losses from the previous year, the ongoing unfair trading practices of foreign competitors and the threat of a new multilateral trade agreement that threatens to export U.S. agricultural production and jobs to other countries.

Anxious moments: Direct payments, MAP & crop insurance
Specifically, the fiscal year 2010 budget proposal issued in late February by the Obama administration seeks to phase out the direct payments for farms with annual sales over $500,000, which – based on the most recent USDA Census of Agriculture – represents farms responsible for nearly 75 percent of all agricultural production in the United States. So, proposing to eliminate those farms from the direct payment program effectively puts at risk a majority of the food, feed and fiber supply in this country by exposing producers to the uncertainties of weather, market swings and financial instability without the safety net that the direct payment program provides.

To put this into perspective, a farm with $500,000 in annual sales could be, using 2008 average yields and prices, a 500-acre rice farm – not a “large agribusiness” by any stretch of the imagination. It is also critically important to note that $500,000 in sales does not translate into $500,000 in farm income.

In addition, we are greatly concerned about the proposal to reduce funding for the Market Access Program (MAP), which is an example of an extremely successful public-private partnership that assists agricultural producers in leveraging industry dollars to further promote agricultural products through the development of export markets. Weakening this program is shortsighted given the growing importance of developing greater export opportunities for U.S. agriculture products.

Furthermore, the budget proposal also seeks to make additional cuts to the crop insurance program, including requiring producers to pay a larger portion of the policy premium.

Farm safety net important to overall economy
During consideration of the fiscal year 2010 budget, we are hopeful that Congress and the Obama administration will recognize the significant contributions of American farm and ranch families to the economic and national security interests of our country and the fact that U.S. farm policy today represents less than one-quarter of one percent of the total federal budget.

USA Rice Federation greatly appreciates the support for the current farm safety net expressed by Reps. Collin Peterson (D-MN) and Frank Lucas (R-OK), chairman and ranking member, respectively, of the House Agriculture Committee; Sen. Saxby Chambliss (R-GA), ranking member of the Senate Agriculture Committee; Sen. Blanche Lincoln (D-AR), Agriculture Committee member; and many other members of Congress in response to this budget proposal.

The farm safety net was, perhaps, the one area of public policy that was not strengthened by the recently passed economic stimulus bill despite the importance of agriculture to the overall economy and the financial difficulty producers are in because of precipitously falling commodity prices that are not being matched by a commensurate drop in production costs.

Accordingly, we are urging Congress to oppose President Obama’s proposed budget cuts to the Farm Bill, which remains the primary economic stimulus package for rural America.

For more about USA rice programs, visit www.usarice.com.