Two months after announcing its intentions to provide a new package to assist family farmers and ranchers coping with trade damages, the USDA has released finalized details about the timing and calculation of direct payments to producers through the Market Facilitation Program (MFP). 

The agency has earmarked up to $14.5 billion for the program to be distributed in three separate tranches. Eligible producers can submit applications for the first tranche beginning next Monday, July 29, through December 6, 2019, and payments will be sent out starting in mid- to late August. Most commodity grain producers will be compensated based on a single county rate ranging from $15 to $150 per planted acre.

For the first round of payments, they will receive a minimum of $15 per acre and up to 50% of the county rate. In contrast, dairy producers will receive 20 cents per hundredweight based on historical production.

Additional relief for hog and specialty crop producers will be available as well. Given the significant difficulties that ongoing trade uncertainty has caused, National Farmers Union is relieved that farmers will be receiving much-needed assistance. NFU President Roger Johnson released the following statement in response to USDA’s announcement:

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Thirty-five farm and food organizations called on elected officials and candidates running for office to address the disproportionate market power held by the giant agribusinesses that dominate livestock and poultry markets. The list of priorities for creating fair and competitive markets for family farmers is endorsed by groups from across the country that represent producers raising livestock and poultry. 

“Our food system is clearly rigged. While just a handful of multi-national corporations have been allowed to exert more and more control over every step of the agricultural supply chain, farmers and ranchers have been left to cope with higher production costs and fewer marketing choices as well as unfair and abusive business practices. These factors have contributed to the increasingly slim profit margins that have forced too many farms to close their doors. Between 2012 and 2017, nearly 70,000 farms went out of business, most of which were mid-sized, family-owned operations,” said National Farmers Union (NFU) President, Roger Johnson. “In light of these circumstances, it is critical that we act now to restore fair competition to agriculture. As the field of 2020 candidates vie for the presidency, we urge them to take the issue of corporate consolidation and anti-trust enforcement seriously by incorporating these recommendations into their platforms.”

The policy changes urged by the groups are needed because the largest meatpackers and processors control all stages of food animal production, forcing farmers into one-sided contracts that eliminate market transparency, depress prices, undermine the livelihoods of independent farmers and ranchers, and threaten farmers’ ability to adopt sustainable production practices.

“Our farm advocates have taken in hundreds of hotline calls from livestock and poultry producers in recent years struggling to make ends meet,” said Sally Lee, Associate Director of RAFI-USA. “These are hardworking farmers who are experts at what they do, but the marketplace has been rigged against them. Farmers deserve dignity and respect for their work, and we cannot let their basic rights be written off in the fine print of an unfair contract.” 

The groups are calling on elected officials and candidates to support measures to rebalance the economic relationships between farmers, ranchers, consumers, workers, and food companies, including policies to:

• Enforce and strengthen antitrust and fair practice laws, including enforcement of the Packers & Stockyards Act. 
• Ensure access to fair farm credit, including holding lenders accountable for equitable lending practices.
• Restore mandatory country-of-origin labeling for beef and pork.
• Stop subsidizing overproduction, including restricting government loan guarantees to large-scale contract operations.
• Break up food and agriculture monopolies, including instituting a moratorium on new mergers in the food and agriculture system. 
• Stop subsidizing foreign corporations, by prohibiting federal procurement programs from buying meat from animals born, raised or slaughtered outside the U.S.
• Level the playing field for independent processors, including addressingthe bias in food safety regulations toward large corporate slaughter and processing facilities. 

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As Congressional leadership and the Trump administration work towards a compromise on the U.S.-Mexico-Canada Agreement (USMCA), the country’s oldest general farm organization is urging additional improvements to the deal that could help to reduce health care costs and protect rural jobs before it is sent to Congress for approval.

In a letter sent to Speaker of the U.S. House of Representatives Nancy Pelosi and House Minority Leader Kevin McCarthy, National Farmers Union (NFU) President Roger Johnson emphasized the value of trade agreements to agricultural communities. “Access to export markets is critical for U.S. family farms,” the letter reads. “Canada and Mexico are the leading export markets for U.S. agricultural products, and USMCA would maintain those important relationships.”

Though international export markets have provided economic opportunities for family farmers and ranchers, the free trade framework that has dominated U.S. trade deals for the past 25 years has not been without its shortcomings. “Farmers are increasingly dependent on off-farm employment to make ends meet,” said Johnson, “but many rural manufacturing and other jobs are moving to foreign markets with cheaper labor and lower environmental standards.” He recommended that Congressional leadership include proposals that would address those issues. “Labor, environment, and enforcement standards must be strengthened to help to keep jobs in rural communities.”

Johnson also expressed concern about the implications of USMCA for rural health care. “The increasing cost of health care, a top concern among NFU members, is eating into already shrinking farm revenue,” writes Johnson, adding that the deal may exacerbate the problem. As written, USMCA would grant pharmaceutical companies marketing exclusivity for biologic drugs for a minimum of 10 years. If approved, this rule would prevent Congress from acting to hasten the entrance of lower-cost generic drugs to the market.

Farming is a notoriously precarious profession – in 2014, there was an estimated 58,000 adult farm injuries. Yet nearly half of farmers are not confident they could cover the costs of treatment for a major illness or injury without going into debt. All Americans should have access to effective health care, but given the added risks of agricultural professions, it is particularly critical that legislators work to improve coverage and affordability in rural areas. USMCA’s prescription drug provision would “limit the actions Congress can take to reduce prescription drug prices,” noted Johnson, and as such, it “must be rectified to allow for future reductions in health care costs.” 

Every five years, according to the enabling legislation for the Soybean Promotion, Research, and Information Program, eligible soybean farmers across the United States have the opportunity to file a form with USDA to request a referendum on the program.

The program, known as the Soybean Checkoff, was voted on by farmers in an initial 1994 referendum. Nearly 86,000 farmers around the country participated in this initial referendum and it passed, 54 to 46 percent. After the initial referendum, the USDA must ask soy farmers every five years if they would like to have another referendum. If 10 percent of eligible soy farmers present in person or by fax Form LS-51-1 to their local FSA office by May 31, 2019 there would be another referendum. Eligible farmers may get the form from their local FSA office or download it here. If you download it and fill it out, it must still be submitted in person or by fax to your local FSA office.

To be eligible to participate in the Request for Referendum, producers must certify that they or the producer entity they are authorized to represent paid an assessment at any time between January 1, 2017, and December 31, 2018.

In plain language, this means that if farmers want to vote on putting an end to the checkoff, enough farmers around the country who have paid the checkoff in the past two years must send in a form to request the right to vote. In 2014, the last time the ‘request for referendum’ window was open, 324 farmers submitted Form LS-51-1. That’s a long way from the nearly 57,000 farmers that were needed to request the referendum in 2014. This year it would take around 52,000 eligible soy farmers.

If there were to be a referendum, it would occur in the next 12 months.

Roger Wise, past-president of Ohio Farmers Union said today, “It’s not often that you get to vote on whether to continue paying a tax – and that’s what that the checkoff is at this point.”

Wise a long-time soybean farmer in Sandusky County said the system is rigged to obfuscate the ability for farmers to hold the vote with the unnecessary step of the ‘request for referendum.’ He also points out that there hasn’t been much of an attempt by USDA or the national or state soybean council to advertise the request for referendum, “and that makes it all the more important that farmers make an attempt to file that form with their local FSA.”

If you’d like to see a vote on whether to continue the soybean checkoff, you have until the end of this month to file the form.

Creation of yet another ‘marketing program’ a fly in the ointment

Earlier this week, Ohio Farmers Union President Joe Logan appeared before the Ohio House Agricultural and Natural Resources Committee as an ‘interested party.’

Logan – and OFU – had hoped to be in the enthusiastic ‘supporter’ column, yet appeared as an interested party due to the bill’s provision that would create another “marketing program” picking the pockets of Ohio farmers.

Logan told the committee, “Our only concern with the bill language is the marketing program language, included in section 924.212. We believe that a statutory mandate for a hemp marketing program is not needed, as current market demand ramatically exceeds supply.

“Farmers have a wealth of experience with commodity marketing programs, as they exist for most of the commodities that farmers produce. We acknowledge that such programs can be useful in times where supplies are excessive and research languishes.

“Neither of these factors is the case for hemp.”

Hemp as an agricultural commodity is so new that there is extraordinarily limited processing capability – none in Ohio or anywhere near – and there are still legitimate questions about the long-term viability of so-called CBD oils as a market driver for industrial hemp.

While advocates of cannabiidiol – CBD – grow in numbers, there is relatively scant research on their viability for all manner of human health efficacy. If CBDs end up being not scientifically effective for the myriad of current potential uses, the air could escape quickly from the CBD balloon.

What is demonstrated around the world is the industrial uses of hemp oils and fibers. From car parts to clothing, hemp yields a valuable input to many products.

Logan prefers that the nascent industrial hemp market be able to grow organically – without the potentially heavy hand of a check-off program that would become dominated by concentrated corporate interests.

Our decades of experience with commodity marketing programs has led us to another concern –
that such programs are nearly always funded by farmers and that benefits normally accrue to the
corporations that process and sell the products.

“It should be noted that some major commodity marketing programs have used funding derived from U.S. producers to oppose federal legislation that would benefit farmers but that was strongly opposed by the nation’s largest processing corporation, even despite that the corporation was foreign owned,” Logan said.

In short, the Ohio Farmers Union strongly supports the decriminalization of hemp and look forward to working with the legislature and state agencies to accomplish this goal. However, we do not believe it is useful for the Ohio House to create an unnecessary bureaucratic body in a hemp marketing program.”

Chronic Oversupply, Depressed Prices Plague Dairy Industry

In response to sustained depressed milk prices, chronic oversupply, farm-level consolidation, and a wave of farm closures, the U.S. House Subcommittee on Livestock and Foreign Agriculture today held a hearing on the state of the dairy economy. National Farmers Union (NFU) President Roger Johnson submitted written testimony highlighting the considerable financial difficulties American dairy producers have withstood for the past several years.

NFU Vice President Patty Edelburg, who co-owns and operates a dairy farm in Amherst Junction, Wisconsin, has witnessed the devastation first-hand. “For more than four years, dairy farmers nationwide have been paid well below the cost of production” she said. “It would take years of profitability for many family dairy farmers to rebuild their equity and get their farms back on stable footing. With mounting piles of debt and no significant price rebound in sight, thousands of family farmers have been left with no choice but to close their doors.”

While short-term support is critical to help farmers survive the immediate economic challenges, Edelburg recommended that legislators also pursue long-term solutions to overproduction, which has plagued the industry for some time. “The 2018 Farm Bill provides improvements that will help stem losses for many family farmers, but this support alone won’t be enough to save the dairy industry. We need to have a meaningful conversation about supply management options that will ensure dairy farmers are paid a fair price from the market.”

In the midst of significant financial stress in the U.S. farm economy, the U.S. Environmental Protection Agency (EPA) must deliver on the promises of President Trump and the intent of Congress to expand the use of biofuels and, therefore, demand for U.S. farm products, according to National Farmers Union (NFU).

The family farm organization submitted comments today to EPA on the agency’s proposed rule to allow year-round use of E15 gasoline. While the rule stands to deliver a long-sought win for the biofuels industry and family farmers, NFU President Roger Johnson said a stronger commitment to further expanding biofuel use is needed from EPA.

“The long and short of it is that the EPA under this administration has repeatedly destroyed direct demand for biofuels, metaphorically piling more and more corn on top of our burdensome oversupply,” said Johnson. “What we need from EPA as they finalize the E15 waiver is a major step in the direction of allowing year-round sales of higher level blends of ethanol in gasoline. That’s the way we cut into oversupply. That’s the way we better our environmental impact. And that’s the way we save consumers more money at the pump.”

In its comments, National Farmers Union urged EPA to expeditiously approve E15 for year-round use and to ensure the rule does not amount to a cap on higher level blends of ethanol, like E30.

“Farmers Union is eager for EPA to follow through on its promises to get an E15 waiver out of the door by June 1,” said NFU President Roger Johnson. “But we are concerned that certain provisions within EPA’s rulemaking unnecessarily work against expanded use of higher level blends of ethanol.”

Provisions within EPA’s E15 proposed rule are limited in scope to E15 gasoline only, without taking advantage of the benefits of mid-level blends of ethanol and making the prospects of using these blends harder to achieve.

NFU also proposed EPA separate its proposed RIN reforms from the E15 rule until the agency has considered the potential implications of the reforms and made such findings public. The organization highlighted RIN-market volatility introduced by EPA’s actions regarding small refinery exemptions. “Under the Trump Administration, EPA’s exemption handouts to oil refiners have destroyed demand for at least 2.6 billion gallons of ethanol, or nearly one billion bushels of American grown corn,” said Johnson.

“It is EPA’s responsibility to follow through on the President’s promises to family farmers and on Congress’s intent to expand biofuel use in our transportation sector,” said Johnson. “We’re calling on the agency to begin to right their wrongs by finalizing an E15 waiver that includes a pathway for expanded use of higher level blends of ethanol.”