Soybean farmers to get $3.6 billion initially from USDA trade package
WASHINGTON — Soybean farmers will receive the majority of the initial payments set aside for assistance to agriculture due to trade disruption.
Officials with the U.S. Department of Agriculture on Monday, Aug. 27, spoke via phone conference with reporters about the details of the $12 billion package, which includes programs for market facilitation, food purchase and distribution and agricultural trade promotion. The program is meant to help farmers get through current market conditions, in which the Trump Administration's trade actions have resulted in retaliatory tariffs being placed on some agricultural products.
Agriculture Secretary Sonny Perdue said the programs are necessary because farmers "cannot pay their bills with simple patriotism."
"After careful analysis by our team at USDA, we have formulated our strategy to mitigate the trade damages sustained by our farmers. Our farmers work hard, and are the most productive in the world, and we aim to protect them," Perdue said.
Bill Northey, USDA undersecretary for farm production and conservation, said the market facilitation portion of the package will account for $4.7 billion in initial payments to producers of seven commodities based on actual production.
Soybeans, with $1.65 per bushel payments, will account for $3.6 billion of the $4.7 billion. Producers of other crops will receive the following payments:
• Wheat: 14 cents per bushel, total of $119.2 million.
• Sorghum: 86 cents per bushel, total $156.8 million.
• Corn: 1 cent per bushel, total of $96 million.
• Cotton: 6 cents per pound, total of $276.9 million.
Two groups of livestock producers also will be included in the program:
• Pork producers will get $8 per head of pigs on hand as of Aug. 1, for a total of $290.3 million.
• Dairy producers will get 12 cents per hundredweight as determined through the Margin Protection Program formula, for a total of $127.4 million.
Producers on Sept. 4 will be able to begin taking in production amounts to their local USDA Service Centers. The program will pay 50 percent of production initially, with another payment possible later depending on market conditions.
Northey said the program only will consider actual production, with no adjustment for disasters like drought or flood. The program also did not adjust for geographic differences in basis; many elevators in the Upper Midwest have substantially higher basis than in other parts of the country.
While some production has yet to be determined, including for soybeans and corn, producers of wheat, pork and dairy can begin bringing in their information to USDA Service Centers on Sept. 4, with payment possible by mid-September.
Though the program will be administered by the Farm Service Agency, Northey said participation in other USDA programs is not necessary.
"You don't have to participate in other programs to be a part of this program," he said.
Greg Ibach, USDA undersecretary for marketing and regulatory programs, said the food purchase and distribution program will account for $1.2 billion in commodity purchases. The program will strive to help calorie-deficient populations and to not displace already-in-place programs.
The USDA, he explained, will be looking for new vendors and new uses of commodities. For instance, instead of just buying oranges, the program may purchase "extra fancy oranges" that had been destined for markets in China.
Ibach said pork, at $558.8 million, apples, at $93.4 million, and dairy, at $84.9 million, are the top targets for the purchase program.
Other commodities in the program include apricots, beef, blueberries, cranberries, figs, grapefruit, grapes, hazelnuts, kidney beans, lemons and limes, lentils, macadamia nuts, navy beans, fresh oranges, orange juice, peanut butter, pears, peas, pecans, pistachios, prune and plums, pork, potatoes, rice, strawberries, sweet corn, walnuts, almonds and sweet cherries.
Ted McKinney, USDA undersecretary for trade and foreign agricultural affairs, said the agricultural trade promotion portion of the program will receive $200 million. Some money may go to fixing or expanding existing trade relationships and other proposals may focus on finding new markets, he explained.
The program will be a cost-share assistance program, meaning other organizations, including commodity groups, also will have money on the line for their proposals. The USDA will take proposals from Sept. 4 to Nov. 2 and will begin reviewing proposals on Nov. 3.
Unlike the other two programs, the agricultural trade promotion program is open to any commodity.
"It is meant to help all sectors," McKinney said.