Nearly seven months after it froze a Trump-era plan, the Biden administration said on Tuesday that up to $1 billion was available to contract growers of pigs and poultry to offset revenue lost to the pandemic in 2020. With the announcement, the USDA has committed more than $8 billion in pandemic aid to farmers and ranchers since March.
The total would grow with the expected announcement on Wednesday of a $400 million program to donate dairy products to food banks. The dairy donation program, like the aid to contract growers, was on a USDA list of coronavirus assistance to be implemented this summer.
“The pandemic has had a tremendous impact on agricultural producers and we have made significant progress since announcing our plans in March,” said administrator Zach Ducheneaux of the Farm Service Agency, which oversees farm subsidies. Additional assistance will be announced in coming weeks, he said.
Although large sums were committed, USDA data show a comparatively small $570 million was disbursed to producers through USDA’s umbrella program, the Coronavirus Food Assistance Program (CFAP), since April 5. Lawmakers prodded USDA periodically in past weeks to release the money earmarked for contract growers, who produce hogs, poultry and eggs under contract for the owner of the animals.
“It should not take well over half-a-year for hard-hit and previously left-behind producers to get emergency aid,” said Arkansas Sen. John Boozman, senior Republican on the Senate Agriculture Committee. “I urged the (USDA) to swiftly process applications so that producers who desperately need this long-awaited help receive it.”
Payments will be calculated at 80 percent of the difference between revenue throughout 2020 and revenue in 2018 or 2019; producers can choose the year that is most representative of their operations. Applications are due by Oct. 12. Payments may be pro-rated if claims exceed the $1 billion earmarked for contract growers in a December 2020 coronavirus package.
The USDA said it included “additional flexibilities” to account for expansion in operations in 2020, growers who went into business in 2020 or did not have 12 months of revenue in 2018 or 2019.
“We appreciate USDA recognizing the incredible losses farmers endured during the height of the pandemic,” said president Zippy Duvall of the American Farm Bureau Federation. “When restaurants and schools closed, the demand for fresh food disappeared almost overnight.” Business evaporated for contract growers with the disruption in food supplies.
Specialty crop growers, already eligible for CFAP payments, also can use 2018 or 2019 as the comparison point for their losses in 2020, said the USDA. Some $2.68 billion has been paid to speicalty crop growers through the current version of CFAP. Specialty crops, such as fruits, vegetables, nuts, horticulture and nursery crops, are grown on a small part of U.S. crop land but have high value per pound or bushel.
Since coronavirus payments began in May 2020, the USDA has sent $24.4 billion directly to producers.
In its first days in office, the Biden administration announced a freeze on regulations issued during the close of the Trump era. The freeze included $3 billion for producers that was announced by USDA on Jan. 15, including $1.98 billion for contract growers, up to $810 million in “top up” payments to hog farmers and $210 million for turfgrass sod, pullets and animal byproducts.
The home page for USDA’s pandemic assistance program is available here.