USDA Releases Details for Market Facilitation Programme; NFU Urges Long-Term Solutions for Oversupply and Low Prices

US - Two months after announcing its intentions to provide a new package to assist family farmers and ranchers coping with trade damages, the US Department of Agriculture (USDA) last week released finalised details about the timing and calculation of direct payments to producers through the Market Facilitation Programme (MFP).
calendar icon 29 July 2019
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The agency has earmarked up to $14.5 billion for the programme to be distributed in three separate tranches. Eligible producers can submit applications for the first tranche beginning today, 29 July, through 6 December 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 percent 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 (NFU) is relieved that farmers will be receiving much-needed assistance.

In response to this announcement, NFU President Roger Johnson said: "Long before this trade war even started, family farmers and ranchers were struggling to make ends meet. Chronic oversupply and slumping commodity prices have beleaguered the agricultural economy for six consecutive years, putting most operations in the red.

"But the unstable markets and rapidly fluctuating prices caused by this administration’s trade policies have made matters even worse. Many farmers didn’t even know what to plant this last spring because they couldn’t begin to anticipate what might be profitable come harvest.

"National Farmers Union appreciates the USDA’s ongoing efforts to support family farmers during this difficult time. However, we harbor some concerns about disparities in payments from county to county, which could put some farmers at a financial disadvantage. Additionally, we are disappointed that the plan does not include incentives to reduce production, which could help alleviate the chronic challenges of excess supply and depressed prices.

"This assistance is desperately needed, but the ad-hoc rollout and convoluted structure of these programmes has caused significant confusion among producers. Until more predictable, longer-term solutions are made available, that sense of confusion and insecurity will likely persist. In the future, we urge the administration to work more closely with Congress to build on the existing safety net and provide certainty and stability in farm country."

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