Herd Check

Farm Bill fails in the house – what now?

Friday, May 18ththe much-anticipated Farm Bill 2018 was voted on by the House of Representatives. The Bill failed on a vote of 198-213. Though intended to be bipartisan, there was a steep divide between Democrats and Republicans, largely on the nutrition and conservation points the Bill addressed. So that leaves us all with the same question – what next? What was even in this thing? I’ve done my best to narrow in on a few of the issues that are most pressing to those of us in agriculture.

I mean, obviously, it’s the Farm Bill and its entirety should involve us as agriculturalists. Despite its name, the Farm Bill blankets food and sustainability topics such as nutrition and conservation. Some of these articles are of more interest to your everyday-somewhat-politically-minded average Joe than the articles that are relevant to those directly employed in agricultural industries. I touch on those, but to get this to you in a timely manner, I focus on a select few of the biggest ones that have been widely discussed in the industries. And of course, to form opinions of your own you can read the entire Bill here.

The issues

This year, the Bill’s spotlights were on SNAP, crop insurance, protection for young and niche market farmers and ranchers, conservation and the former MPP (now the DRMP). In normal people world (what I consider all non-agriculturalists) the dividing issue on the bill was, of course, SNAP benefits. Basically, this Farm Bill would require current SNAP recipients of an able body without dependents under the age of 6 to participate in mandatory skill-building classes and work for 20 hours a week to improve their situation, under Title IV – Nutrition. As you can imagine, this point was the dividing factor that pretty much guaranteed the Democrats (and the general Left for that matter) wouldn’t be on board.

I personally thought the requirements rather reasonable, as the elderly and children currently on SNAP and unable to work would be protected. And no one would lose their benefits unless they were of able body and refused to work, then they’d choose to leave the program. I didn’t find that ridiculous by any stretch of the imagination. However, when we’re trying to get our nation on the same page for something as basic as agriculture, making an abrupt change on a tender issue probably wasn’t the wisest of decisions. Most people were done after hearing about this topic, but for us, we’re just getting started.

 

I’ve noticed some differing opinions from different individuals, organizations, and companies from across our industries, as ya will. I got an email from my state Farm Bureau calling for our support of the bill and asking that we take action and contact our Representatives to vote yes. Some major players, such as Land O’ Lakes Inc and the National Milk Producers Federation played roles in the recommendations of specific bill components and encouraged members to all voice their thoughts on the bill to their Representatives. It’s safe to say the majority of conventional agriculture was on board with the majority of the Bill. However, there were those who believed the bill wasn’t strong enough in some areas and that agriculturalists should voice the need for something better, including the National Young Farmer’s Coalition. One newspaper columnist found the whole thing lackluster, calling it a clone of the last Farm Bill of 2014. It’s hardly fun, but let’s sift through this jumble of details and see what you can get from all this mess.

 

Title I: Commodities

This section covered some basic farm policy – the big ones being risk management and Dairy Risk Management Program (DRMP). According to a handout from the House Agriculture Committee “Farm Bill Top 10 Highlights” this section “…works to address the 5-year, 52-percent decline in the farm economy by providing certainty that an extension of current policy cannot provide. The bill reauthorizes and strengthens the Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) options through 2023. Producers are given an opportunity to make a new election between ARC and PLC with several improvements, including allowing a new yield update opportunity for producers who were facing severe drought during the previous yield update, allowing reference minimize disparities between counties.” So far so good right?

Let’s jump down to Subtitle D, the DRMP which would replace the (milk) Margin Protection Program (MPP) of 2014. This made essential four changes to protect dairymen and make some improvements. I’ll break them down by section as printed in the Bill.

Sec. 1401. Dairy risk management program for dairy producers.

According to the aforementioned Land O Lakes article, this would “Improve the accuracy and affordability of MPP premium rates” and also “Expand Livestock Gross Margin (LGM) program and allow compatibility with MPP.”

Sec. 1402. Class I skim milk price.

The short version of this is given again by Land O Lakes is that this will “restore original feed cost formula and adjust feed and milk price data sources.” The long version comes from this Progressive Dairymen article: “NMPF and the International Dairy Foods Association (IDFA), an organization representing about 525 U.S. dairy manufacturing and marketing companies, called for the change. The change replaces the current monthly “higher of” Class III and Class IV milk prices used in calculations, instead of setting the monthly beverage milk price equal to the simple average of the advanced Class III and IV milk prices, plus 74 cents per hundredweight.” This also would change the feed cost formula, per advising from the NMPF.

Sec. 1403. Extension of dairy forward pricing program.

Sec. 1404. Extension of dairy indemnity program.

Sec. 1405. Extension of dairy promotion and research program.

Sec. 1406. Repeal of dairy product donation program.

Basically, these are exactly as they sound. They are the extensions and repeal of programs in the 2014 Farm Bill.

 

Title XI: Crop Insurance

Crop insurance is made of some of the stuff that keeps some farmers in business, this is especially true for young and beginning farmers who are most at risk in their investments. Opponents of this title argued that the Bill seeks to benefit larger producers more so than the smaller, more at risk farmers. This title would eliminate key payment limits on commodity subsidies by raising the insurance payout rates on the “farm safety net.” The House Agriculture Committee insists that this wouldn’t harm crop insurance policies that have been in place since the 2014 bill, as many producers and insurance agencies voiced, again and again, they didn’t want to see major changes. Therefore, the idea was that this Farm Bill doesn’t “fix what isn’t broken.” Opinions on this title, again, vary depending on your situation, if you’re a largescale producer you probably liked it just fine if you are a niche market you were probably hoping for lower premiums or incentives. There have been hopes in some organizations that a new Farm Bill might be able to make some tweaks to make both parties happy.

 

According to another House Agriculture Committee handout “If advocates of extending the 2014 Farm Bill get their way…critical programs for trade, SNAP, beginning farmers, organic agriculture and others will lose their funding.” This included about 40 programs that didn’t have a baseline past 2018. Some Conservation programs, another big deal on this Bill, would also lose their funding.

With the September 30th deadline looming for Congress to pass this year’s Farm Bill, Republicans are reconvening to work to redraft a bill that will hopefully, please more people. I refuse to say they could redraft a Bill that would “work for everyone” because I don’t believe such a Bill ever could exist.

 

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