The New Farm Bill

The new Farm Bill has passed both the Senate and House by large majority votes and is just waiting for a Presidential signature.  The following summary of the Farm Bill is from Ben Brown with Ohio State.  Ben does a great job at making legislative material understandable.

Farm Bill

Moving to the farm bill. This is the reason I have slept minimally the last two nights. I’m wondering if this is what it is like to have small children. It is 807 pages and can be found here. The Senate passed their version last night 87-13. That is largest margin for a farm bill in the history of farm policy. This is the first time since 1990 that the farm bill will be passed in the same year it was introduced and the first time since 2002 it was passed before any of the commodity programs expired. The House passed the bill this afternoon with a vote of 369-47. It now goes to the President’s desk for signature. December 13 just seems like a good day to sign a bill.

Several of you have asked for summaries for your weekly news columns so here is my title by title summary. I must apologize I have not made it through Title 4 which is Nutrition. However, the expanded work requirements were taken out. Also for states that want to fill for a work requirement exemption they will now need to require the Governor’s signature.

Title 1- Commodities

Producers will get the option to re-enroll in 2019 between Price Loss Coverage (PLC) and Agricultural Risk Coverage (ARC). They will not get to reallocate base acres like in 2014. In 2020 producers will have the option to update yields for crops between 2013-2017. Then for years 2021, 2022, and 2023 they will get to make an annual enrollment choice between PLC and ARC-CO. The individual option for ARC was eliminated.

Reference Prices were left the same with corn at $3.70, soybean at $8.40 and wheat at $5.50. However, if the marketing year average price for a five year period minus the high and the low is greater than 1.15% of the reference price then the reference prices can increase. Soybeans would be the most likely candidate.

The “transitional” yield substitution for ARC that was 70% of the 2014 farm bill was increased to 80%. This might benefit soybeans in future years when ARC is more attractive. Yields will now be based on Risk Management Association Data instead of NASS data. This will probably be a wash as some counties could see an increase and some might see a decrease. All of these changes were made possible by eliminating ARC and PLC enrollment under base acres that were planted to a non-covered commodity (grass pasture). Unplanted base acres can qualify for an annual payment of $18/ acre under the Conservation Stewardship Program for a minimum of five year contracts. This is how they paid for a lot of the other areas of the bill.

Commodity loan rates were increased for most commodities, wheat- $3.38, corn-$2.20, and soybeans $6.20.

Payment limitations for commodity programs were expanded for cousins, nieces and nephews and the opposition of Senator Grassley of Iowa. He voted no on the final bill because of the expanded payments.

For Dairy the Margin Protection Program was renamed the Dairy Margin Coverage Program. The lower tier (Milk below 5 million pounds) saw premium coverage rates lowered even further from those that were set in the budget bill passed in February. Three new coverage levels were added at $8.50, $9 and $9.50. Producers who lock in coverage for 5 years under DMC can get a 25% discount on their premiums. Producers who enrolled under MPP can get 75% of their previous premiums back to re-enroll under DMC. If they want that cash in hand they can get 50% back.

Title 2- Conservation

Conservation Reserve Acreage was increased to 27 million acres up from 24 million. It is tiered up over a three year period. Traditional enrollment gets a payment that is equal to 85% of the county rental rate. Re-enrollment acres get 90% of the county rental rate.

The Conservation Stewardship Program, which was cut under the House version of the bill was left as a standalone program but reduced in funding. Part of the program dollars will be used to pay the $18/acre of acres that don’t qualify for ARC or PLC payments.

Environmental Quality Incentives Program saw an increase of funding and the livestock restriction on dollars was reduced from 60% of the total funds to 50%.

The Regional Conservation Partnership Program was made it’s own standalone program and funded at $300 million.

Title 3- Trade

No major changes other than the programs get permanent baseline funding similar to Commodity programs.

Title 4- Nutrition

See above

Title 5- Credit

The limit on direct ownership loans was raised to $600,000 and the limit on direct operating loans was raised to $400,000.

Title 6- Rural Development

Pilot projects to combat the opioid crisis. Broadband internet received guidelines for grants that were authorized under the 2018 Budget Bill, but no new money.

Title 7- Research

The Foundation for Food and Agricultural Research received $185 million down from $200 million in the 2014 bill.

Organic Agriculture Research was funded at 20 million and increases 5 million every year until 2023 and then it is a constant $50 million each year.

Title 8- Forestry

This title did not include the forest cleaning language that the Administration wanted and was left roughly the same as I can interpret. I don’t really know a lot about the Forestry title other than this year it was a bigger sticking point than most.

Title 9- Energy

This title was eliminated in the House version but made it through to the final version.

Bioenergy programs were reduced in funding.

Title 10- Horticulture

Creates a new Urban, Indoor and other Emerging Agricultural Production Research, Education and Extension Initiative funded at 10 million dollars.

Ironically, since Pesticide training is going on today in the 4-H center, the retention of the Pesticide Registration Improvement Act was not renewed. This accounted for a very large share of the Environmental Protection Agency’s Budget. I actually don’t know how much, but it’s significant.

Title 11- Crop Insurance

Industrial Hemp is made an eligible crop for crop insurance. This was a primary objective of Senator McConnell from Kentucky. He signed the conference report with a hemp based pen.

Whole Farm Revenue Protection is extended at reduced rates for beginning farmers for 10 years.

Title 12- Miscellaneous

A vaccine bank for infectious diseases was funded at $300 million over 10 years. This was a big priority of commodity groups. They wanted $150 million every year. This was probably expedited by the African swine fever in Southeast Asia.

There is Beginning Farmers and Rancher Development Program and the outreach and assistance in this area funded at $435 million over 10 year.

There is a newly created food waste liaison to coordinating program for reducing food waste.

Have a Blessed Day!!

Ben

Ben Brown
Program Manager- Farm Management Program
College of Food, Agricultural, & Environmental Sciences
Department of Agricultural, Environmental, and Development Economics
2120 Fyffe Road, Columbus, OH 43210
614-688-8686 Office / 660-492-7574 Mobile
brown.6888@osu.edu   cfaes.osu.edu

 

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