The size of budget sequestration cuts in crop subsidies “is still up in the air,” Agriculture Secretary Tom Vilsack told DTN. The cuts will fall in the range of 6.8 percent to 7.3 percent unless Congress changes the 2011 sequestration law. Little thought was given to the impact of the sequestration law on the farm program until economist Art Barnaby of Kansas State U wrote a blog about the issue last week. Different levels of cuts were assigned to different fiscal years. The situation for farmers is snarled because they must enroll by Sept. 30 for crops grown in 2014 and 2015 for payment in fiscal 2016.
“Vilsack said his instructions to Farm Service Agency leaders are to be as equitable as possible in dealing with producers and sequester cuts,” said DTN. Crop subsidy payments “are capped at $125,000 for an individual or $250,000 for a married couple with both spouses eligible for payments. Under a 7.3% cut, a couple hitting the ceiling on ARC payments, for example, would see those payments reduced $18,250. With a 6.8% cut, those payments would be $17,000 lower.”