Congress should authorize “significant economic assistance” to farmers before the end of this year to offset lower commodity prices and high production costs, said the senior Republican on the Senate Agriculture Committee on Monday. “Federal assistance must support agricultural producers facing market losses and it needs to happen quickly,” said Arkansas Sen. John Boozman with Congress scheduled to adjourn in three weeks.
Farm groups and their allies in Congress have turned their attention to a bailout package since work on the new farm bill was deadlocked. Lawmakers were expected to pass a one-year extension of the current law in the interim. A relief bill in the House would provide at least $21 billion to farmers with a maximum payment of $350,00 per person, nearly three times the usual $125,000 limit for crop subsidies, say analysts.
In a Senate speech, Boozman did not suggest a price tag for aid but said the House bill recognized “the urgent need” in farm country. “Producers need an efficient mechanism to provide 2024 economic assistance and certainty for 2025 through an improved farm safety net,” he said. “It’s an understanding that is gaining support on both sides of the Capitol.”
Seventeen Republican governors from farm states wrote congressional leaders on Monday in support of “reauthorization of a farm bill and immediate assistance in the interim.” Farm bill payments usually are made a year after harvest, which would be in 2026 if the new farm bill applied to crops grown in 2025.
House and Senate Republicans have proposed a 15 percent increase in so-called reference prices, which would make it easier to trigger subsidy payments.
Various estimates of farm financial stress have circulated. For example, Boozman cited $29 billion in “farm income losses” for the eight major field crops this year and the Republican governors said farmers were projected “to lose up to $35 billion in lost profit this year” while some university economists say corn and soybean growers are likely to lose from $50 to $160 per acre when land costs are included.
The USDA was scheduled to update its estimate of net farm income, a measurement of profitability, on Tuesday. In September, income was forecast at $140 billion, fourth-highest on record but down sharply from the record $182 billion of 2022. Median total farm household income was projected at $99,683 this year, compared to median U.S. household income of $80,610 in 2023.
Direct federal payments were estimated at $10.2 billion this year, compared to a record $45.6 billion in 2020. The government sent tens of billions of dollars to farmers over the past several year to offset the impact of the Sino-U.S. trade war and the pandemic.