There Are Plenty of Questions as the Farm Bill Debate Kicks Off

(Ohio’s County Journal) – Though it seems like the last farm bill has just been finally implemented, discussions are already ramping up for the next farm bill in Washington, D.C. With a new Administration, a challenging farm economy and the ever-shifting whims of public perceptions about agriculture, there is plenty of uncertainty about the outcome.

“There is a lot of conversation about where this Administration is going to spend the money. We are going to have a lot of push from conservative groups who typically align with rural Americans for cuts in the farm bill. It is a continual effort on our part to help farmers understand who is working for them and who is working against them. This will be critical to continue to talk about in the ag community,” said Adam Ward, executive director of the Ohio Soybean Association. “I think we will see more support from conservation compliance going forward, but I think a big part of the conversation is that conservation is helping us grow better crops and develop long-term opportunities for farmers beyond this generation. I think that will be part of the fight and I see the conservation title being stronger.”

While there is endless potential for speculation, there are some likely scenarios.

“We have to really understand collectively as the commodities that we have to be on the same page this time in the farm bill. We can’t have fractured commodities going after their own pieces and parts. There is a lot of concern about Title I going forward. Will Title I programs even exist anymore? That is why we are talking to farmers about what works and what we are going to fight to protect,” Ward said. “We will see the same debate we saw last time between the House and the Senate with the Senate seemingly more for the Midwest and the House more for the South. Those factors played a huge role in the debate last time and also made agriculture look fractured. The goal is to not look fractured in this debate.”

In the spirit of a unified agriculture, Ward said the American Soybean Association could play an important role.

“Soybeans are unique from the standpoint of the geographic range they cover. Soybeans get beyond the Corn Belt and dig deeper into the south than corn,” he said. “We have some geographical diversity amongst our soybean leaders at the national level and ASA can be a leader in pulling everyone together to get a farm bill that works for all interests. It will be up to the farmer leadership working with their respective commodities to get a good safety net for all farmers.”

Ward also expects to see other things in smaller farm bill titles that are of increased interest including access to rural broadband and access to some of the different trade programs. Trade was one of the most common discussion topics brought up by Ohio Corn & Wheat Growers Association (OCWGA) members in a recently held series of Farm Bill Listening Sessions.

“We set up six listening sessions across Ohio and invited members of the OCWGA. We administered a 34-question electronic survey with multiple-choice questions on farm bill related topics. It covered Title I commodity safety net programs, Title II conservation programs and general overall questions. Those were asked at all six sessions so we could see the trends around the state. That took around 25 minutes or so at each session, and then we were able to have a discussion about differences of opinions that showed up in the real-time results. There were some minor differences but nothing really too divergent across the state and no real surprises. One of the things that was interesting, though, was related to one issue that has been top of mind — international trade as it relates to farm commodities,” said John Torres, director of government and industry affairs for OCWGA. “One of the things we really wanted to find out was whether or not trade was a top-of-mind issue for our members. Most came back to say that they may not think about trade every minute of the day, but when they have time to sit down and think about the implications of the market on their farm’s income potential, trade was something they were thinking about. With what the Trump Administration is doing in regard to trade, it is top of mind. I think it is going to guide the OCWGA board of directors to strategize in a way that puts trade at the forefront of what we’re asking Congress to focus on.”

Trade is not necessarily a major component of the farm bill, but there are some important provisions included.

“When a farmer goes in to the Farm Service Agency office they are not signing up for a trade program, but there are two small provisions within the farm bill that involve trade. One is Foreign Market Development and another is Market Access Program. Those are small funded programs within USDA that help enable organizations like the U.S. Grains Council and U.S. Wheat Associates in conjunction with checkoff dollars and other private investments to organize trade missions around the world to nurture relationships with potential buyers,” Torres said. “Those are programs that have long-run benefits as we start seeing open market opportunities around the world. That is something farmers want to learn more about to see how we can leverage those dollars for developing new markets.”

Of course, along with these smaller programs, the larger pieces of the farm bill were also covered extensively in the OCWGA listening sessions.

“We will probably see more discussion about whether we need to tighten our belts a little more in response to what Congress and the public has asked for in terms of fiscal conservatism. In the last couple of farm bills, U.S. farmers have done their part to tighten their belts. We are reaching the point, though, in which there is not a lot of tightening left to be had. If we are being asked to give up more, where should we reallocate resources moving forward? One thing that came out of the listening sessions very clearly was that the No. 1 program that has helped Ohio grain farmers from previous farm bills is the subsidies to crop insurance premiums. That is where they find the most benefits. Yes, they participate in Agricultural Risk Coverage (ARC-County or ARC-Individual) but really rely on that crop insurance program as the biggest risk management tool,” Torres said. “We will have to have discussions about what will be politically palatable with Title I programs. We have seen cuts already to the crop insurance program and we’ll have to see where the discussion goes with ARC and Price Loss Coverage (PLC). All of those programs benefit various regions and crops differently. Do we maintain that diverse portfolio or do we narrowly focus on just a few things moving forward?

“Everyone seemed very satisfied with the ARC-County or ARC-Individual Program. Some wheat growers participated in PLC. Almost everyone had a great understanding of those Title I programs at the listening sessions.”

There were several potential concerns brought up in the listening sessions as well.

“One concern was that the ARC-County Program calculates payments based heavily on the National Agricultural Statistics Service surveys through USDA. Those are reliant on farmers returning those surveys and some farmers are reluctant to do that. How reliable then are those calculations and are the NASS surveys a reliable source of data? Farmers would like to see the Risk Management Agency crop insurance data that has to be submitted through the crop insurance program used to calculate payments for ARC-County,” Torres said. “The question of base acres has been coming up too. Should we continue to use historic base acres in calculating those payments or should farmers be able to resubmit actual planted acres on an annual basis? There are questions of whether or not doing so is World Trade Organization compliant between amber box and green box restrictions, which we test our domestic farm programs through based on internationally agreed upon standards. How would that be administered moving forward?

“We did hear that one reason for using historical base acres is that if you allowed farmers to enroll planted acres on an annual basis, farmers may look to the government for signals that may indicate which crops may be more profitable to plant than others year-to-year thus creating government induced distortions in the market. It could give the appearance to the world that maybe the U.S. is incentivizing one commodity over another from year-to-year instead of allowing the natural market conditions to guide what farmers choose or don’t choose to plant. When you use historical base acre numbers it removes the appearance that the government is artificially incentivizing farmers to plant or not plant certain crops.”

The long-running debate about pairing nutrition assistance programs with the farm programs in the farm bill will also be a part of the 2017 discussion.

“Eighty percent of the 2014 Farm Bill funding was designated to food assistance programs. Do we continue to keep those together for political reasons to get the bill passed or do we separate those out?” Torres said. “Farmers are kind of self conscious of the perception that the public might have thinking that all of this federal funding is going to them. The public often does not understand that most of the farm bill goes to nutrition programs. Farmers feel like their reputation is taking a hit in the public arena because of these misconceptions about what the farm bill does and doesn’t do.”

All of these factors will certainly be part of a very uncertain debate moving forward.

“Sonny Perdue, President Trump’s nominee for Secretary of Agriculture, has been pretty quiet on this so far and the Trump Administration has not said much. We have heard some speculation that President Trump will be very conservative with agriculture, but we don’t really know exactly what that means. We’ll have to wait and see how things shake out at USDA and the discussions surrounding the farm bill,” Torres said. “Whatever association, farmers need to find opportunities to communicate to their representatives and their organizations to share those real life stories about what is working in the current farm bill and what isn’t working. We don’t want Congress writing the next farm bill without any farmer input about what needs to be changed. That is why we held these listening sessions, so we can pass this information on to Congress as the discussion ramps up.”

And make no mistake, the discussion has already started.

“Chairman Roberts of the Senate Committee on Agriculture, Nutrition, and Forestry actually convened a joint meeting of the House and Senate Ag Committees on Jan. 23 to start the farm bill discussions. We thought we’d see the first hearings in Congress start in February and it looks like that is on track. These discussions will be fact-finding hearings. They want those personal stories about how farmers have been interacting with the programs. How are people utilizing these programs? How are they working?” Torres said. “Some people are speculating that if Congress feels like it has enough information by the end of the summer they may start drafting a farm bill as early as this fall and not even wait until next year to start. We could see this progress fairly quickly.”