October 26, 2016

Market Conditions Prompts “Early Farm Bill” Discourse

Categories: Farm Bill

Renée Jean reported yesterday at the Williston Herald (N.D.) Online that, “The ink is barely dry on $7 billion in 2015 payments from the 2014 farm bill’s market-based programs to assist farmers with low prices, but the adequacy of both Agriculture Risk Coverage and Price Loss Coverage payments likely to be a hot topic for 2017.

“While the Farm Bill doesn’t expire until Sept. 30, 2018, some are calling for a new farm bill as early as possible. Republican Senator Chuck Grassley (R-IA), for example, on Wednesday said he cannot see why the bill couldn’t get done a year in advance, to better help farmers with prices this year, which have been even lower than 2015.

“That kind of talk is pushing senators in both Montana and North Dakota to get their ear to the farm ground early on the farm bill. North Dakota Sen. Heidi Heitkamp (D) and Montana Senators Jon Tester (R) and Steve Daines (R) have already scheduled listening tours to collect input. North Dakota Sen. John Hoeven said he would start his listening tours in 2017.”

The article noted: “‘We should start early and get this wrapped up as soon as possible,’ Daines said. ‘I think it is ridiculous we cannot get a farm bill put together sooner, to remove that uncertainty from the farmer. They face uncertainty all the time from the weather and other things. They don’t need additional uncertainty from Washington, D.C. Let’s get this done a year in advance.'”

Yesterday’s article added that, “‘The push is going to be on to get this done sooner than later and not drag this out,’ [Sen. Heitkamp] said. ‘I’d like to see a farm bill reauthorized before the termination of this one in the Senate.'”

Nonetheless, Ms. Jean pointed out that, “Hoeven, who sits on the committee that writes the farm bill, said an early bill is not only unlikely but impossible. But, he added, they can work on other things to help farmers in the meantime.”

In a separate article last week at the the Sidney Herald (Mont.) Online, Renée Jean reported that, “The ball is already on the ground and rolling for the 2018 farm bill, and U.S. Sen. Steve Daines, R-Mont., had his ear to the ground for those issues most on farmers’ minds during a visit to Sidney Sugars Wednesday, where growers talked about the increasing difficulties they face getting to a profitable harvest.”

The article noted the importance of crop insurance to producers: “Crop insurance is becoming more and more necessary to the survival of family farms, said Don Steinbeisser Jr.

“‘My grandfather didn’t even know what it was, much less use it,’ he said. ‘Now if you have a bad year, you need it. The bank’s not going to ignore it.'”

Despite the chatter about an early Farm Bill, recall that last month, the Chairman of both the House and Senate Ag Committees expressed reluctance about the concept of an early Farm Bill while speaking at a public forum at the Kansas State Fair.

At that forum, House Ag Committee Chairman Mike Conaway (R., Tex.) noted that low prices have spurred calls for re-opening the Farm Bill and for consideration of ad hoc disaster assistance; he indicated that “we are going to be very resistant to that.” Similarly, Senate Ag Committee Chairman Pat Roberts (R., Kan.) pointed out there could be a risk of losing more than could potentially be gained if the Farm Bill was opened back up.


WIC Changes Impact Food Choices, Without Adding to Government Costs

Categories: Farm Bill /Food Aid /Obesity

Stephanie Strom reported yesterday at The New York Times Online that, “Can people make healthier food choices without spending more money?

In a review of federal food subsidy programs, researchers found that nudging shoppers toward more healthful foods pushed cheap junk food out of the family shopping basket without adding to the government’s costs.

“The data come from a study of purchases by users of the Special Supplemental Nutrition Program for Women, Infants and Children, better known as WIC, before and after changes were imposed to encourage healthy eating.”

Ms. Strom noted that, “In 2009, the Department of Agriculture, which administers the WIC program, added vouchers aimed at increasing consumption of fruit, vegetables and whole grains while reducing saturated fat, cholesterol and sugar. To avoid raising overall costs, the program limited other items. The program restricted the amount of reduced-fat milk, cheese and juice recipients could buy, and eliminated whole milk from the program. If WIC users wanted to purchase foods not on the list, they had to use their own money, rather than the WIC vouchers or cards.

“While many nutritionists today would not agree with all the changes, particularly the focus on lowering fat, the net effect was an overall improvement in the quality of foods and beverages the shopper purchased.”


USDA to Distribute $7 Billion in Farm Bill Payments this Fall

Categories: Farm Bill

Reuters writer Tom Polansek reported yesterday that, “The U.S. Department of Agriculture will pay more than $7 billion of taxpayers’ money to farmers this fall to keep them afloat in the face of low crop prices, agency officials said on Tuesday.

“The USDA released the total on the same day that payments started going out to more than 1.5 million growers of corn, soybeans and other crops, who had enrolled in U.S. safety-net programs to protect themselves from market downturns last year.

Prices for the crops have stayed low in 2016 as massive harvests around the world have increased inventories and intensified competition for exports.”

The Reuters article noted that, “In August, the USDA predicted net farm income in 2016 would fall 11.5 percent from 2015 to $71.5 billion because of low commodity prices. If realized, that would be the lowest since 2009.

“It also would mean that USDA’s safety-net payments accounted for about 10 percent of net farm income for 2016.”

Mr. Polansek added that, “Last year, the agency paid farmers $5.2 billion under the programs to cover weak markets in 2014.”

Also yesterday, Julie Harker reported at Brownfield Online that, “[USDA’s Farm Service Agency (FSA) Administrator Val Dolcini] says more money is going out to farmers than last year, ‘We’re about 50% more than the 2014 crop year and that means we are paying more farmers and more counties around the country. Certainly, corn and soybeans and wheat all had very high levels of payment activity.’

“Dolcini says farms enrolled in ARC have suffered $27-Billion in revenue losses in the last year or so. He admits the ARC and PLC payments won’t make farmers ‘whole‘ but says assistance from Congress on the loan side and USDA assistance in other ways will also help. Funding from the recently passed continuing resolution, Dolcini says, will take care of the FSA loan backlog.”

Audio remarks from Administrator Dolcini can also be heard at the Brownfield link.

The FSA released more specific details regarding the Farm Bill payments for corn yesterday, and noted that, “The following maps show 2014 and 2015 ARC/PLC payments by crop and the average of the payments for the two years. The map of average payments shows how ARC/PLC works to pay different counties over time based on the yields and price in those counties. As this map shows, over time high and low payment rates under ARC-CO are moderated and the pattern tends to be smoothed. This effect is expected to result in further smoothing as the entire 5-year program is completed in future years.

“Approximately 1.7 million farms are enrolled in the ARC/PLC program. In 2014, the ARC-CO program paid approximately 900,000 farms a total of $4.4 billion for all crops. In 2015, the initial ARC-CO program payment run (additional payments are expected later in the year as price and eligibility data become available) is expected to pay approximately $5.6 billion to about 1.2 million farms.

“While not reflected in the maps, the Price Loss Coverage (PLC) program paid approximately $800,000 to about 90,000 farms in 2014 for all crops. In 2015, the initial PLC payment run (additional payments are also expected) is estimated to be about $1.2 billion to over 350,000 farms.”

Similar information from FSA regarding soybean payments can be viewed here, while wheat maps and analysis can be found here.

In addition to the Payment Rate maps, FSA also released Revenue Maps yesterday for corn, soybeans and wheat.

In a tweet yesterday, Todd Gleason noted that, “Interesting ARC County analysis via @usdafsa. One map shows revenue shortfall, the other how well ARC covered it.”


FAPRI Baseline Update: Farm Income, Government Outlays- Cash Rental Rates Decline

Yesterday, the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri, released a report titled, “Baseline Update for U.S. Farm Income and Government Outlays.”

In part, the FAPRI report stated that, “Net farm income is expected to decline for the third straight year in 2016 and is likely to remain well below recent peaks for the next several years.”

More specifically, the report noted that, “Sharply lower cattle and egg prices contribute to a $23 billion reduction in projected livestock sector receipts in 2016. Crop receipts also decline slightly, as lower prices for corn, wheat and other crops offset the impact of increased production.

“Projected net farm income declines by $10 billion in 2016, as the drop in receipts outweighs reductions in production costs.”

Other highlights of yesterday’s FAPRI update included:

“August USDA reports indicated cropland rental rates and average farm real estate values declined in 2016 after years of sharp increases. Additional declines are projected for 2017‐2019 in response to sharp reductions in crop returns relative to recent peak levels.

“With reduced asset values, the projected ratio of farm debts to assets increases from 12 percent in 2015 to 14 percent in 2019.

“Government farm program outlays peak in fiscal year 2018, when many payments associated with the 2016/17 marketing year are made.”

Table from yesterday’s FAPRI update

Meanwhile, a news release last week from University of Missouri Extension stated that, “The latest USDA cash rental survey shows decreasing rental rates in some areas of Missouri, says University of Missouri Extension agricultural business specialist Joe Koenen.

“USDA’s National Agricultural Statistics Service (NASS) released its annual survey Sept. 9. View data on Missouri counties at

“‘Some of the better crop counties in central and north Missouri showed a decrease in rental rates, reflecting lower crop prices,’ Koenen says. Other counties remain unchanged, and pasture rates held stable or showed slight increases.”

The news release added that, “Low prices and high corn yields will put pressure on rental rates, [Koenen] says. Soybean prices dropped, but not as much as corn prices. A decrease in soybean prices also will likely affect rent prices. ‘How much is still to be determined.’

“Koenen says it is important for landowners and renters to know yields on cropland. Yields and land quality affect what the renter pays.”


Rep. Peterson Highlights CRP

Categories: Conservation /Farm Bill

In his Email newsletter on Friday, House Ag Committee ranking member Collin Peterson (D., Minn.) highlighted issues associated with the Conservation Reserve Program and the Farm Bill.

Specfically, Rep. Peterson stated that: “This week I had a chance to sit down with Pheasants Forever’s Dave Nomsen to talk about the future of the Conservation Reserve Program, known as CRP, in the next farm bill. I remain concerned that we are losing too many of the large tracts that provide excellent habitat for wildlife. Although the budget restraints in the farm bill remain a challenge when it comes to making significant changes to the program, there are a number of things we can do to make this program more farmer friendly — like increasing the flexibility around the haying and grazing rules. I look forward to working with Pheasants Forever and other conservation and agriculture organizations as we take a careful look at how this program is working and what changes we would like to see in the next farm bill.”


Federal Farm Safety Net Contracts- Crop Insurance Issues

DTN Executive Editor Marcia Zarley Taylor reported yesterday that, “Farmers know they must weather the lean years to benefit from the occasional fat ones. But erosion in federal crop revenue insurance guarantees since 2013 is compounding the risks for farm operators during this downturn.

“‘In times like this, we aren’t worried about making money. Our goal is to make darn sure we don’t lose too much,’ said Mark Bryant, who raises wheat, corn and soybeans with brother Mike and other family members in Washington Courthouse, Ohio.

Bryant’s problem is the crop insurance floor keeps falling with commodity prices, exposing his farm to ever bigger losses. Ohio winter wheat producers, who face a 2017 crop insurance sale closing date of Sept. 30, will be guaranteed only $4.74 per bushel next year, down 45% from the same coverage four years ago.”

Ms. Taylor noted that, “Winter wheat isn’t alone. Back in 2013, a typical non-irrigated Kansas corn grower could guarantee about $678 per acre (thanks to a $5.65 base price and 120 bpa historic yield with 80% coverage.) By 2016, that protection had dipped 32% — to a base price of $3.86 and $463 per acre coverage, observed Kansas State University economist Allen Featherstone.

“Sadly, production costs haven’t retreated nearly as far or as fast as prices, leaving farmers to self-insure those revenue gaps.”

The DTN update added that, “Based on futures prices in late September, Featherstone expects that same 80% corn coverage to shrink to only $448 per acre coverage with a $3.73 guarantee in his Kansas example. That’s an additional $230-per-acre operator risk compared to four years earlier.

“Soybeans also have suffered from a similar safety net shrinkage, although they stand to get a small bump upward come spring. Featherstone projects 2017 spring insurance prices at $9.31 for soybeans, down from $12.87 per bushel in 2013 but up from $8.85 per bushel in 2016.”

DTN Graph Courtesy of KSU

Ms. Taylor also pointed out that, “Bryant is exploring private insurance products that will help him boost the floor on coverage. University economists also continue to recommend options like Yield Exclusion (YE), Yield Adjustment (YA) and Trend Adjustment (TA), which may significantly boost a grower’s Actual Production History (APH) and ultimately, their revenue per acre.”


Rep. Crawford Highlights Private Disaster Relief for Farmers

A news release on Tuesday from House Ag Committee member Rick Crawford (R., Ark.) stated that, “Today [Rep. Crawford] introduced H.R. 6167, the Farm Risk Abatement and Mitigation Election (FRAME) Act, to give farmers the option of taking disaster preparedness into their own hands. The FRAME Act would establish tax-deferred farm savings accounts that farmers could then withdraw from during difficult times without waiting on disaster declarations and government assistance.

“In a conversation with the chairman of the Arkansas Bankers Association, Sean Williams, Congressman Crawford discussed the details of the legislation and how it would work in practice, including its impact on rural communities and banks. The video [is available below], and the audio here.”

The news release added that, “Like IRA’s and Health Savings Accounts, Crawford’s proposed FRAME Accounts would allow contributions, capital gains and dividends to be tax-deferred. Farmers would then be able to draw from the FRAME account whenever they needed it to cope with a disaster, independent of government or state designation, which can often be slow in coming.

“To encourage initial investment, farmers will be eligible to write-off FRAME Account contributions on their tax bill. Contributions will be tax deductible up to $50,000 per year, and farmers will retain 10% of their contributions in the form of a tax credit during the first few years after opening the account.”

And Brownfield’s Tom Steever reported yesterday that, “The accounts, said Crawford, are intended for emergency money in lieu of ad hoc disaster payments which he says are harder to come by.

“‘We’re looking at this as a way essentially for farmers to get a little bit of the tax benefit for implementing a risk management strategy that they can utilize at their own discretion, obviously with those safeguards that we talked about before,’ he said, ‘but it puts the taxpayer at no exposure.’

“The Farm Risk Abatement & Mitigation Election – FRAME – Act provides for penalties when the account is used for non-farm related expenditures such as vacations, according to Crawford. Contributions to the accounts, capital gains and dividends, he said, are to be tax-deferred.”

Mr. Steever and Rep. Crawford also discussed the legislation in more detail, an audio replay of their conversation is available here.


Sec. Vilsack Discusses Farm Economy at Senate Ag Committee Hearing

Yesterday, Secretary of Agriculture Tom Vilsack testified before the Senate Ag Committee at a hearing titled, “The U.S. Department of Agriculture and the Current State of the Farm Economy.”

In his prepared testimony, Sec. Vilsack pointed out that, “Even as commodity prices have weakened and farm incomes have decreased, the rural economy remains strong. Our work to increase trade, grow the bioeconomy, strengthen local and regional food systems, and expand conservation have resulted in a more resilient rural economy. Rural and urban areas continue to recover from the Great Recession. Median income for farm households remains near the historic high of 2014 — 35 percent higher than median US household income in 2015.”

(Click here for a closer look at “Rural” growth and “Farm” income).

In his opening remarks, Chairman Pat Roberts (R., Kans.) pointed out that, “Eleven days ago, I and Chairman Conaway attended the Kansas State Fair, a great opportunity to hear first-hand what folks had on their minds.  Plain and simple, farmers and ranchers are worried. The downturn in the agricultural economy is taking a toll on their pocketbooks and the health of many family operations.”

Chairman Roberts added that, “In Kansas and across the Midwest, we have had a bountiful wheat harvest, and now there are expectations for potentially record-setting corn and soybean crops.

“Most years this would be great news, however these high yields come at a time when we are experiencing large inventories worldwide. At the farm gate, the drop in commodity prices and farm income are felt first hand…and their magnitude is foremost on everyone’s minds around this table.”

Ag Committee Ranking Member, Debbie Stabenow (D., Mich.) indicated in her opening remarks that, “As we know, there has been a dramatic slowdown in the farm economy since the passage of the Farm Bill. Farm income has dropped by over 50 percent—the steepest drop in farm income since the Great Depression. Our farm safety net keeps producers in business when disaster strikes. The 2014 Farm Bill made historic reforms by shifting away from direct payments to a focus on the risk management tools farmers requested to support producers during the bad years like we are seeing today.

“New and beginning farmers are especially vulnerable to financial stress during these times, making access to credit an especially important tool. I applaud USDA for taking action earlier this month to provide additional funding for farm loans. I am hopeful Congress can provide additional flexibility for USDA to extend credit to all farmers in need.”

To listen to an exchange between Chairman Roberts and Sec. Vilsack that highlighted “farm household” income in greater detail, click on the link below.

A news release today from Sen. John Hoeven (R., N.D.) stated that, “Hoeven thanked Vilsack for joining the Office of the United States Trade Representative (USTR) in launching a new trade enforcement challenge against China at the World Trade Organization (WTO). USTR is challenging the country’s excessive subsidies of wheat, rice and corn.”  (A portion of the Sec. Vilsack’s remarks on this issue can be heard on the link below).

Sen. Hoeven’s news release added that, “The senator also requested Vilsack’s support for his Capital for Farmers and Ranchers Act, bipartisan legislation Hoeven introduced with Senator Amy Klobuchar (D-Minn.) to increase the maximum loan amount that an individual farmer or rancher is able to receive under FSA’s loan and loan guarantee programs.”

Sen. David Perdue (R., Ga.) also participated in yesterday’s Senate Ag Committee hearing, a replay of his discussion with the agriculture Secretary is available below.

In part, Sen. Perdue noted that, “I’m concerned about regulation. Everywhere that I go, I talk to our farmers. Regulation is the number one topic [of concern], then comes labor.”

Iowa GOP Senator Joni Ernst (R-Iowa) also highlighted regulatory concerns at yesterday’s hearing, noting that, “And what I’m hearing mostly from our Iowans, especially the farmers, the ranchers, and our land owners, is that it really feels like the federal government is out to get them, and I see that a lot with a number of the rules and regulations that are coming forward.”

The full discussion Sen. Ernst had with Sec. Vilack can be viewed below.

A news release yesterday from Sen. John Thune (R., S.D.) stated in part that, “Thune discussed the lack of common-sense guidance and policy for the Conservation Reserve Program (CRP), which is critical to South Dakota agriculture as an economic alternative to farming marginal and fragile lands. Additionally, CRP provides most of the brood-rearing habitat for South Dakota’s pheasant population, which brings in more than $250 million to the state’s economy.”

A replay of Sen. Thune’s discussion from yesterday’s hearing is available below.

Former Committee Chairman Pat Leahy (D., Vt.) highlighted dairy issues at yesterday’s hearing, a portion of his remarks on this issue can be seen below.

DTN writer Todd Neeley reported yesterday that, “What’s more, as debate on the next farm bill will commence next year, the ability to maintain a strong safety net is expected to be front and center.

“‘This administration has proposed cuts to crop insurance programs each and every year,’ Roberts said. ‘We fought hard to stop a $3 billion cut. The crop insurance program is not a bank. In regard to these proposed cuts — not in this room, not on my watch.'”

The DTN article added that, “Demand for farm loans has been increasing, [Sec. Vilsack] he said, ‘driven in part by the need to cover operating expenses as commodity prices have fallen more quickly than costs.

“‘As a result, the debt-to-asset ratio for U.S. producers has increased over the past two years, but in aggregate is still near historic lows,’ Vilsack said.”

And an update yesterday from WHO radio (Des Moines, Iowa) stated in part that, “In fact, Vilsack told lawmakers that in his opinion, a common factor between essentially every hot spot in the world is the fact that none have a functioning agricultural economy, and all of them have a lot of hungry people.

“‘So if we’re serious about protecting our own people, if we’re serious about making sure the world is a safer and better place for our kids and grandkids, then we have to understand the role that agriculture in this country, and agriculture around the world, will play in providing that level of security,’ he said, ‘and I think, frankly, that there is a lack of appreciation, at times, not certainly in this committee, but in other parts of this town, on the significant role that agriculture plays.'”

And Ken Anderson reported yesterday at Brownfield that, “As the USDA works to implement the GMO labeling law, Senate Agriculture Committee chair Pat Roberts cautions the agency to stay within the limits of what Congress intended.

“During a committee hearing Wednesday, Roberts asked Ag Secretary Tom Vilsack about a proposed USDA study on whether consumers will actually use electronic or digital devices when making food purchasing decisions. Roberts said that question goes beyond the scope of the GMO labeling law.”

The Brownfield update added that, “Vilsack disagreed with Roberts’ assessment. He said the study will provide valuable information as USDA develops the framework for GMO labeling.”


Chairman Conaway on Farm Policy and Food Prices, Related ERS Update

Categories: Farm Bill /Food Prices

Recall that over the weekend, Senate Ag Committee Chairman Pat Roberts (R., Kans.) and House Ag Committee Chairman Mike Conaway (R., Tex.) discussed a variety of current issues impacting the U.S. agricultural economy and farm policy at the Kansas State Fair in Hutchinson.

In particular, before embarking on changes to federal agricultural policies, Chairman Conaway said that he wanted “to know what it does to the cost of food.” He added that “we have 45 million Americans on food stamps [SNAP],” when he analyses farm policies he thinks in terms of what we are getting in return for government investment- and current policies are working, “there is no denying that,” he said.

Noting that on average, Americans spend 9.8% of disposable income on food, Chairman Conaway indicated that,“what I care about is the folks at the bottom 20% of the economic food chain, it’s not 9.8% of their disposable income, they are paying 30-35% of their disposable income for food.”

With this background on the importance of food costs to policy makers in mind, the USDA’s Economic Research Service (ERS) indicated last week (“Percent of Income Spent on Food Falls as Income Rises“) that, “[P]oorer households spend less money on food than higher income households, but this accounts for a greater share of their income.”

The ERS update indicated that, “Over the past two and a half decades, U.S. households in the lowest income quintile (the poorest 20 percent of households) spent between 28.8 and 42.6 percent of their annual before-tax income on food, compared with 6.5 to 9.2 percent spent by households in the highest income quintile. Before-tax income includes earnings and other money income, public assistance, Supplemental Security Income payments, and Supplemental Nutrition Assistance Program (SNAP) benefits.

The share of income spent on food is more volatile for poorer households than for higher income households. The lowest income households saw their share of income spent on food drop from 41.1 to 28.8 percent over the years 2001 to 2007 but then rise to 35.5 percent in 2009. Meanwhile, over the same period, the highest income households saw relatively minor yearly swings of 0.5 to 1.0 percentage points.”

The ERS report explained that, “This volatility in the share of income spent on food by the lowest income quintile is due in part to (1) changes in grocery store (food-at-home) prices and (2) changes in earned income and Federal assistance benefits. The 2001 jump in the share of income spent on food by the lowest income quintile illustrates the impact of rising food prices. Although incomes were steadily increasing for low-income households at this time, at-home food prices increased by 3.3 percent from 2000 to 2001. Higher food prices disproportionately affect the spending behavior of low-income households and often require them to allocate a larger share of their incomes to food.”


Senator Booker, Representatives Ryan and Lee Urge Department of Agriculture to Modernize SNAP Program by Bringing Benefits Online

Categories: Farm Bill /Food Aid

September 12, 2016

Monique Waters
Press Secretary

Senator Booker, Representatives Ryan and Lee Urge Department of Agriculture to Modernize SNAP Program by Bringing Benefits Online

“Modernizing SNAP benefits will help increase the opportunity for low-income families to access healthy and affordable food that could ultimately lead to healthier lives.”

WASHINGTON, DC – Today, U.S. Sen. Cory Booker (D-NJ), along with U.S. Reps. Tim Ryan (D-OH) and Barbara Lee (D-CA) sent a letter to U.S. Department of Agriculture Secretary Tom Vilsack urging him to expedite United States Department of Agriculture’s (USDA) acceptance of the Supplemental Nutrition Assistance Program (SNAP) for online transactions, which would expand access to healthier foods for low-income individuals and families.

“It is imperative for the economic future and the health of all Americans to ensure that each person has access to nutritious and affordable food, especially the 46 million people who rely on SNAP to ensure that they and their families have enough food to eat. As you know, individuals and their families who rely on SNAP are more likely to reside in food deserts, have lower nutrition education, and live in poverty. That is why it is vital that our nation commits to reducing hunger and bolstering nutrition through improvements in SNAP, such as online transactions,” Sen. Booker and Reps. Ryan and Lee wrote in the letter.

“We know that technological advancements over the last 10 years, like the proliferation of smartphones, have dramatically increased access to the internet throughout our country. Unfortunately, many of our governmental policies and programs have not kept pace with the dramatic improvement in healthy food access that technology offers.

“We deeply appreciate all of your efforts to increase access to healthy foods for all Americans, including your commitment to launch a demonstration project to allow use of SNAP online. However, given the urgent need to catch up with the rapid pace at which the private sector is utilizing technology to expand access to healthy foods, we urge you to consider moving up the timing for beginning the project, allowing all eligible retailers to participate, and facilitating their participation by shortening the projects timeframe,” they concluded.

The full letter can be viewed here.


Rep. McGovern Address Hunger Issues

Categories: Farm Bill /Nutrition

Rep. Jim McGovern (D., Mass.) addressed issues associated with hunger in America on the House floor yesterday.  A transcript of his remarks follows.

Mr. Speaker, thousands of people will gather in Washington, D.C., this weekend for Feeding the 5000, an event designed to bring awareness to the issue of food waste. Participants will be served a communal meal made entirely out of food that would otherwise have been discarded—in other words, wasted. Since 2009, Feedback, a global environmental organization working to end food waste, has hosted dozens of Feeding the 5000 events in cities across the globe.

I am pleased to see so many local partners—including government agencies, charitable organizations, NGOs, industry, and chefs—joining together to call attention to food waste, because the truth of the matter is we will need all of these partners working together to solve the issue of food waste.

Last year, the USDA announced their first ever food waste reduction goal, calling for a 50 percent reduction in food waste by 2030. USDA is working with charitable organizations, faith- based groups, and the private sector, and I believe this goal is 100 percent achievable.

American consumers, businesses, and farms spend an estimated $218 billion per year growing, processing, transporting, and disposing of food that is never eaten. Up to 40 percent of all food grown is never eaten; 40 to 50 million tons of food is sent to landfills each year, plus another 10 million tons is left unharvested on farms. This food waste translates into approximately 387 billion calories of food that went unconsumed. With 50 million Americans—including 16 million children— struggling with hunger every year, these are startling figures.

We know food waste occurs throughout the supply chain, from harvesting to manufacturing, to retail operations and consumer habits. But we must do more to reduce food waste at every stage, recover food that would otherwise have been wasted, and recycle unavoidable waste as animal feed, compost, or energy.

Thankfully, there is already a lot of great work being doing to raise awareness about the problem of food waste. Just last week, I attended a screening of the documentary film called ‘‘Just Eat It’’ at Amherst Cinema, organized by The Food Bank of Western Massachusetts. ‘‘Just Eat It’’ follows a cou- ple, Jen and Grant, as they stop going to the grocery store and live solely off of foods that would have been thrown away. Jen and Grant were able to find an abundance of perfectly safe and healthy food available for consumption that would have been thrown away.

It is exciting to see new partnerships forming to study food waste and find ways to use this perfectly good food to reduce hunger in our communities. One such private-public collaboration, ReFED, has brought together over 30 business, government, and NGO leaders committed to wide-scale solutions to U.S. food waste.

In March 2016, ReFED released a Roadmap that charts the course for a 20 percent reduction of food waste within a decade. The Roadmap calls for farmers to reduce unharvested food and create secondary markets for imperfect produce. It calls on manufacturers to reduce inefficiencies, make packaging adjustments, and standardize date labeling. It calls on food service companies to further implement waste tracking and incorporate imperfect produce and smaller plates into restaurants. It urges the Federal Government to strengthen tax incentives for food donations and consider standardized date labeling legislation.

The good news is that many in the industry are already taking steps to dramatically cut down on wasted food by implementing robust donation programs. For example, Starbucks recently announced it will soon scale up its successful food donation pilot program nationwide. In partnership with the Food Donation Connection and Feeding America, Starbucks will donate unsold food from more than 7,000 company-operated stores—salads, sand- wiches, and other refrigerated items— to the Feeding America food bank network. By 2021, that amounts to almost 50 million meals.

Our college campuses are also stepping up. Both the Campus Kitchens Project and the Food Recovery Net- work will work with college dining facilities and students to provide hunger relief in their local communities. In my congressional district, Becker College, Holy Cross College, Smith College, the University of Massachusetts Amherst, and Worcester Polytechnic Institute all have campus food recovery initiatives.

Over the past 35 years, Feeding America has demonstrated an outstanding commitment to ensuring food that would otherwise have been wasted makes its way to food banks across the country and into the homes of families in need. There are dozens of other in- dustry leaders also taking steps to reduce food waste by implementing manufacturing upgrades, maximizing harvests, and utilizing recycling initiatives.

I appreciate the efforts of the Food Waste Reduction Alliance in bringing together industry partners to reduce food waste, shrink the environmental footprint, and alleviate hunger in our communities.

Reducing food waste is one step we can take toward our goal of ending hunger in the United States and throughout the world. I am pleased to see so many partners at every level of the food supply chain taking action to reduce food waste, but there is still more that needs to be done. Let’s solve the problem of food waste, and let’s end hunger now.

Rep. Jim McGovern Addresses SNAP (Food Stamp) Issues

Categories: Farm Bill /Nutrition

Rep. Jim McGovern (D., Mass.), the ranking member of the House Agriculture Subcommittee on Nutrition, delivered a floor speech yesterday where he addressed issues associated with the Supplemental Nutrition Assistance Program (SNAP, or Food Stamps).

A transcript of Rep. McGovern’s remarks follow:

Mr. Speaker, on April 1, thousands of poor Americans started losing their SNAP, or food stamp, benefits.

All told, over the course of this year, as many as 1 million adults will be cut off from SNAP. That is because one of the harshest provisions in the 1996 welfare reform law says that adults working less than 20 hours a week or not enrolled in a job training program can only receive 3 months of SNAP in a 36- month period.

The problem is, however, that many areas of the country haven’t fully recovered from the recession. There are no open jobs, and worker training slots are all full.

The economic recovery has been uneven across the country, and for many individuals—through no fault of their own—getting back to work has been difficult.

At the height of the recession, Governors across this country, both Democratic and Republican, asked the U.S. Department of Agriculture to allow them to temporarily waive work requirements and provide SNAP benefits to unemployed, childless adults for longer periods of time.

But now some Governors are refusing to extend those work waivers even in areas of their States with high unem- ployment. For 1 million of the poorest Americans, to lose food assistance in the midst of this is unconscionable.

Mr. Speaker, we are talking about the poorest of the poor. These are childless adults whose income averages 29 percent of the poverty line, or about $3,400 a year, a year. No one can live on that.

Many face multiple barriers to employment, including disability, limited education, and chronic homelessness. Their employment can be sporadic, often cycling in and out of low-wage jobs with unpredictable hours that do not lift them out of poverty.

What is most appalling is that about 60,000 of those who will be cut off from SNAP this year are veterans. That is right. These are the brave men and women who stood up to protect our country, and now we don’t have the decency to help them put food on the table when they come home. We should be ashamed.

Mr. Speaker, let me be clear about something. The 3-month limit on childless adults receiving SNAP is not a work requirement, despite what some of my Republican colleagues say. It is a time limit. There is no requirement that States offer work or job training to those who are about to lose their benefit. There is nothing here that incentivizes work. Rather, it penalizes those who are struggling the most.

Work requirements and other Federal assistance programs typically require people to look for work or accept any job or job training slot that is offered, but do not cut people off who are willing to work and are looking for a job simply because they cannot find one.

But that is not the case with SNAP. So individuals who have been searching for a job for months, who have applied to every job posting they have seen, and who can’t get into a job training program because the wait list is too long are punished.

Study after study shows that the longer someone is unemployed, the harder it is to get hired. It is baffling to me that the Republicans’ answer to them is: Sorry. You are out of luck.

The Bureau of Labor Statistics estimates that it takes someone who is unemployed about 6 months of looking to find a job.

That is twice as long as the 3-month time limit. For the life of me, I can’t understand how making someone hungrier helps them find a job faster. We should be making people’s lives better, not harder.

This notion that some on the Republican side peddle that somehow SNAP is this overly generous program that people are just jumping to get into, it is ridiculous. It is false. The average SNAP benefit is $1.40 per meal per day. That is meager. It is inadequate.

And this idea that SNAP is the root of our budget problems is outrageous. New data released from the Department of Treasury just last week shows that SNAP spending is falling. In the first half of the current fiscal year, SNAP spending was at its lowest level since 2010. Not only that, but SNAP caseloads are falling, too. That is due to the improving economy.

SNAP operated like it was supposed to during the recession. It was expanded to meet the needs of the millions who lost their jobs, of middle class families who never imagined they would need food assistance in the first place. And now, as our economy improves, fewer people need the assistance. But we are not there yet.

Cutting 1 million of the poorest Americans off from food assistance is wrong. Increasing hunger is wrong. And I would say to the Republican leadership of this House, the narrative that you have put forward about those in poverty does not reflect the reality. Rather than demonize the poor and diminish their struggle, we ought to come together to help, not hurt, people. We ought to end hunger now. This war on the poor has to stop.


House Ag Subcommittee: Growing Farm Financial Pressure

Recall that recent news items regarding the agricultural economy have included phrases like, “Mounting Pressure,” and “There Definitely Could be Some Pain;” while the Federal Reserve Board indicated in its most recent Beige Book report that, “Some crop input prices, such as fertilizer and diesel prices, moderated from year-ago levels, but profit margins were expected to remain relatively weak due to suppressed commodity prices.”

The Fed added that, “A contact in eastern Montana reported that less- profitable farms were leaving the business, and more exits were expected.”

Yesterday, the House Agriculture Committee’s Subcommittee on General Farm Commodities and Risk Management held a hearing on the “growing financial pressures faced by U.S. farmers and ranchers. ”

A Subcommittee news release yesterday indicated that, “Conditions in farm country today contrast sharply with those during the formulation of the 2014 Farm Bill. While high prices for many farm commodities led to tremendous growth in net farm income through 2013, many of those prices have spiraled downward over the past three years. Witnesses spoke broadly about the factors that are driving current market conditions, the bleak outlook going forward, and the impact that both are having and could continue to have on our nation’s farmers and ranchers going forward. They also spoke to the vital role that farm policy and crop insurance are playing in helping absorb some of the shock, and they stressed the devastating impact that further reductions to these vital tools could have.”

Subcommittee Chairman Rick Crawford (R., Ark.) stated that, “Next year, we will head into a new Congress, and we will write a new Farm Bill. As we head into that long and difficult process, I hope our colleagues who are less directly involved in agriculture or farm policy will reflect on just how critically important farm policy is in responding to a crisis that can happen overnight.”

USDA Chief Economist Dr. Rob Johansson indicated at yesterday’s hearing that, “A strong dollar coupled with high-levels of global agricultural production leave U.S. producers facing commodity prices that continue to decline from record levels and a more difficult trading environment than last year. As a result there will be growing financial pressures on some producers this year, as expected revenue may not be sufficient to cover expected costs. Overall, USDA forecasts that net cash income will fall again in 2016.”

And Texas A&M agricultural economist Joe Outlaw pointed out yesterday that, “Cash rents have come down a little, but nowhere near the amount that commodity prices and returns have fallen. This is due in-part because some producers have multi-year lease agreements. However several cash lease tenants reported their landlord’s have been unwilling to lower cash lease rates.”

Dr. Outlaw added that, “[T]the current poor situation on farms across this country would be considerably worse if not for the safety net provided by both Title I commodity policies and federal crop insurance. There are some in agriculture who say that commodity policies are more important than crop insurance or vice versa. I believe they are equally important – especially during times of low prices. For example, lenders tend to view crop insurance as being more important because the insurance guarantee is ‘bankable,” meaning it is something on which they can base a loan. On the other hand, producers see the commodity assistance as the only chance they have of coming close to breaking even in a low price environment.

“And finally, in my opinion, the interest groups that continue to call for changes that would negatively impact these two key policy tools clearly either have no idea how difficult the financial situation is across agriculture or they simply do not care. Farmers in this country deserve better than to continually be threatened with changes that I consider a dismantling of the safety net.”

With respect to the price outlook for 2016, University of Illinois agricultural economists Scott Irwin and Darrel Good indicated recently at farmdoc daily (“Forming Corn and Soybean Price Expectations for 2016-17“) that, “Using new ending-stocks-to-use pricing models (farmdoc daily, April 6, 2016), we conclude that the probability of the 2016-17 marketing year average farm price of corn and soybeans to be below $3.40 and $9.00, respectively, appears to be quite low at this time. For perspective, substantially lower prices would require a demand environment even weaker than occurred during the Great Recession of 2008-09. A more interesting question revolves around the conditions required to increase the average price to levels that would be considered profitable for most producers. If overall demand remains weak, prospects of very small year ending stocks would likely be required to move averages above $4.00 and $10.00 for corn and soybeans, respectively, which would be helpful but would not represent a return to general profitability. However, there are factors that could improve the demand environment in the year ahead. These include crop production problems in other parts of the world that would extend the demand for U.S. corn and soybeans, a realignment of currency exchange rates that would favor U.S. corn and soybean exports, and policies that enhance the domestic demand for corn and soybeans. Recent dryness that poses, or may pose, some threat to the Malaysian palm oil crop and the second-season Brazilian corn crop are examples of production problems that would enhance export demand. The current biofuels policy that is supporting biodiesel production also has the potential to support soybean oil consumption at a higher level. It is interesting that the futures markets may already be anticipating some of these developments, as the markets are currently projecting 2016-17 marketing year average prices of about $3.70 for corn and $9.40 for soybeans.”


GOP Proposes SNAP Funding Cut

Categories: Farm Bill /Nutrition

Pete Kasperowicz reported today at The Washington Examiner Online that, “House Republicans are looking to push through a Department of Agriculture spending bill this year that would cut the federal food stamp program by $1.2 billion compared to current year funding.

“The House Appropriations Committee released legislation Tuesday that provides $79.7 billion for the Supplemental Nutrition Assistance Program, or SNAP.”

The article noted that, “In March, USDA noted that compared to two years ago, there are 2 million fewer people using SNAP, informally known as the food stamp program.”


House Ag Committee Holds Hearings to Review USDA Agencies (SNAP, Crop Insurance)

Categories: Farm Bill

On Thursday and Friday, the House Agriculture Committee held hearings “examining USDA organization and program administration.”

A Committee news release on Thursday noted that, “USDA officials from the Food, Nutrition and Consumer Services (FNCS), Food Safety (FS), and Rural Development (RD) mission areas served as witnesses.

“This hearing series follows a similar series the committee held with USDA last fall. By setting aside two days each year to focus on examining each of USDA’s seven mission areas and their respective agencies, members of the committee gain a fuller understanding of how the various parts of USDA work together to achieve the department’s purpose and goals.”

Recall that nutrition programs comprise the largest percentage of Farm Bill spending.

In prepared remarks on Thursday, USDA Under Secretary for Food, Nutrition and Consumer Services Kevin Concannon, indicated that, “As this Committee continues to review SNAP [food stamps], I want to speak candidly about the proposal raised by some to change SNAP into a block grant provided to States; such a change would have significant and negative consequences for the SNAP program. A block grant structure would significantly erode SNAP’s responsiveness to those it serves and ultimately be a step backwards in the national fight against hunger.”

Mr. Concannon added that, “While flexibility is critical to ensuring that States can meet the needs of their residents facing difficult circumstances, members of this Committee have criticized States for how they have used their flexibility, and sought to constrain it in certain areas. The most notable of these is States use of broad-based categorical eligibility, an option by which States extend eligibility to households that receive a non-cash benefit funded by TANF. Conversely, there are examples where States are not taking options favored by the Committee. The Agricultural Act of 2014 codified existing FNS rulemaking that allows States the option to withhold issuing replacement cards to households with excessive requests, defined as five or more in a year. FNS provided States this option as excessive card replacements may be an indicator of potential benefit trafficking. To date, only three States – Iowa, Massachusetts, and Michigan –have adopted this State option.”

Mr. Colcannon also noted that, “As vital as the program is to so many, we can all agree that it would be better if fewer families needed to utilize SNAP because poverty and need were lower. And while the trends are pointing in the right direction – we are currently projecting a 2.3 percent decrease in participation for Fiscal Year 2017 – some ask, why haven’t we made more progress in reducing the need for SNAP, given the reductions in unemployment in recent months?

While overall unemployment has declined, unemployment rates for some workers remain far higher than average. Bureau of Labor Statistics data show that unemployment rates for high school graduates are substantially higher than for college graduates. Workers without high school diplomas are even more likely to be unemployed, and their wages are likely to be far lower than those with more education. Furthermore, some citizens have trouble entering the labor force because of criminal records or other problems from years past. And, many who have jobs do not get the hours and wages they need to meet their food needs but may not be eligible for many other forms of assistance. SNAP is also serving more eligible people because of State and USDA efforts to streamline the program to ensure that those who need benefits are able to access the program with less hassle and paperwork.”

In a news release yesterday, the Ag Committee noted that, “Today, the House Agriculture Committee completed its two-day examination of the USDA’s organization and program administration. Over the past two days, members of the committee heard from 25 undersecretaries, administrators, and other department officials across USDA’s seven mission areas, on a variety of topics, which included an accounting for each area’s purpose and goals, programs administered, and annual budget.”

Witnesses testifying on Friday included, “USDA officials for the Natural Resources and Environment (NRE), Farm and Foreign Agricultural Services (FFAS), Research, Education and Economics (REE), and Marketing and Regulatory Programs (MRP) mission areas.”

As was noted in an earlier FarmPolicy update, the administrations proposed cuts to crop insurance were highlighted on Thursday at the House Agriculture Appropriations Subcommittee.

In prepared remarks on Friday, USDA Deputy Under Secretary for Farm and Foreign Agricultural Services, Alexis Taylor, indicated that, “The Federal crop insurance program is a vital risk-mitigation tool available to our Nation’s agricultural producers. It provides risk management solutions that are market driven and reflect the diversity of the agricultural sector, including specialty crops, organic agriculture, forage and rangeland, as well as staple row crops.

“Over its history, the value of the Federal crop insurance program to American agriculture has grown. In 2015, the crop insurance program provided coverage on more than 298 million acres of farm and ranch land and protected over $102 billion of agricultural production. As of February 25, 2016, indemnity payments to producers on their 2015 crops total just over $5.6 billion on a premium volume of just under $10 billion. Our current projection for the 2016 crop year shows the value of protection will be slightly less than $100 billion.”

Ms. Taylor added that, “Incentives authorized in the 2014 Farm Bill make crop insurance more affordable for beginning farmers and ranchers by providing a 10 percent premium discount, as well as a waiver of the catastrophic and additional coverage administrative fees. Over 13,500 producers have taken advantage of these incentives. Beginning farmers and ranchers have saved over $14.5 million in premiums and administrative fees because of this program.

“The Farm Bill included several reforms to the Federal crop insurance program; however, there remain further opportunities for improvements and efficiencies. The President’s 2017 budget includes two proposals to reform crop insurance, which are expected to save $18 billion over 10 years. This includes reducing subsidies for revenue insurance that insure the price at the time of harvest by 10 percentage points and reforming prevented planting coverage. These reforms will make the program less costly to the taxpayer while still maintaining a quality safety net for farmers.”

With respect to program integrity, Ms. Taylor stated that, “I am proud to report that the improper payment rate for Fiscal Year 2015 is 2.2 percent, down from 5.5 percent in FY 2014.”


Agriculture Budget and Appropriations Issues, Including Crop Insurance

Categories: Budget /Farm Bill

An update yesterday at the National Sustainable Agriculture Coalition Blog (NSAC) provided an excellent recap of budget and appropriations issues that are impacting agriculture.

The NSAC update included a link to the House Agriculture Appropriations Subcommittee hearings for the FY2017 appropriations cycle that the Subcommittee held last month, as well as a recap of the remaining Subcommittee appropriations that concluded last week.

With respect to the Farm and Foreign Agricultural Services Subcommittee appropriations hearing, which was held on Thursday,  yesterday’s NSAC update pointed out that, “Congressman Robert Aderholt (R-AL), Chairman of the House Agriculture Appropriations Subcommittee [opening statement here], began the Farm and Foreign Agricultural Services hearing by arguing against the Administration’s proposal to reform crop insurance subsidies.

“‘The budget proposal is misguided by seeking to change a mandatory spending program through the appropriations process,’ Chairman Aderholt said.”

Yesterday’s NSAC update also explained that, “Ranking Member [Sam Farr (D., Calf.)] asked RMA Administrator Brandon Willis [prepared testimony] what is being done to make crop insurance work better for producers practicing sustainable, organic, and diversified agriculture. Administrator Willis mentioned Whole-Farm Revenue Insurance, and noted that the number of organic price elections has expanded significantly over the last several years. He committed to continuing to expand those opportunities.

“Similarly, Congresswoman [Chellie Pingree (D., Maine)] urged RMA to make it easier for producers to use conservation practices, such as cover crops, without having to fear losing their crop insurance. Producers who use cover crops must follow a complicated and sometimes confusing set of guidelines for terminating those crops in order to qualify for crop insurance. Pingree urged Administrator Willis to instead classify cover crop as a ‘good farming practice‘ so that producers can more easily pursue conservation efforts without fear of losing their insurance.”

The NSAC update added that: “Following weeks of lobbying for program support by fellow members, and public and private stakeholders, Members of Congress finally submit their appropriations requests to the Subcommittee this week. We expect the Subcommittee to begin reviewing those requests and writing its bill between now and early April. At this point, the Senate Agriculture Appropriations Subcommittee has held far fewer appropriations hearings than the House, so it may require considerably more time before it begins to write its own bill.”


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