The Coronavirus Food Assistance Program, or CFAP 2, provides agricultural producers with financial assistance to help absorb some of the increased marketing costs associated with the pandemic.

“America’s agriculture communities are resilient, but still face many challenges due to the COVID-19 pandemic. These payments directed by President Trump will continue to help this critical industry recoup some of their losses from ongoing market disruptions and associated costs,” Perdue said. “This program builds upon the over $10 billion disbursed under the first round of CFAP. Agricultural producers who have been impacted by the pandemic since April 2020 are encouraged to apply for assistance.”

Since CFAP 2 enrollment began on September 21, FSA has approved more than 443,000 applications. The top five states for payments are Iowa, Nebraska, Minnesota, Illinois and Kansas.

Through CFAP 2, USDA is making available up to $14 billion for producers.

Source: USDA

The USDA chief said the application process will open on May 26, and money would start moving as soon as a week later. That means stimulus funding will finally reach the hard-hit industry two months after Congress passed the CARES Act in late March.

The application window will remain open through August, Perdue said, but he expects most producers will not wait that long. The department is publishing details of the final $16 billion payment package this week.

Source: Politico

Agriculture Secretary Sonny Perdue said the direct aid to farmers will total $16 billion. The remaining $3 billion will cover surplus food purchases.

The $16 billion distribution breakdown includes:

• $9.6 billion for the livestock industry
• $5.1 billion for cattle
• $2.9 billion for dairy
• $1.6 billion for hogs
• $3.9 billion for row crop producers
• $2.1 billion for specialty crops
• $500 million for other crops

The National Pork Producers Council said hog producers’ slice of the aid package will “fall short.”

“While the direct payments to hog farmers will offset some losses for some farmers, they are not sufficient to sustain the varied market participants, including those who own hogs as well as thousands of contract growers who care for pigs,” NPPC President Howard A.V. Roth said.

USDA will begin taking applications in May and providing payments in June.

The administration is financing the payments through a combination of the new spending authority from Congress included in the stimulus package and existing funds. Trump said an additional $14 billion in aid would be available in July by replenishing the Commodities Credit Corporation and distributing the funds through the CARES Act.

An April 14 economic analysis by the University of Missouri projected an $11.85 billion loss in revenue for the crops sector this year and an additional $20.24 billion reduction in receipts for all livestock sectors combined.

Sources: USDA, Farm Progress

President Trump said the aid will focus on “smaller farmers who are very, very badly hurting right now.”

The president asked Secretary Sonny Perdue to expedite relief for the industry and to keep the food supply chain flowing smoothly amid massive financial and logistical hurdles.

“We are going to be working with the small farmers, the big farmers, the cattlemen, the ranchers, all of the producers,” Trump said Friday.

Congress last month authorized USDA to spend more than $23 billion to keep farmers and ranchers afloat. The department since then has been consulting outside economists and fielding ideas from industry groups about the best way to disperse funds across the vast farm economy.

Details of the $16 billion package are not yet defined.

Source: Politico

Farmers who could not plant a crop this year because of flooding, too much moisture, or other non-drought related reasons will receive extra assistance from the federal crop insurance program. Growers will automatically get a “top-up” on their so-called prevented planting claims of either 10 or 15 percent, depending on their insurance policy. There’s no sign-up period, and checks start going out in mid-October.

“It was a challenging planting season for many of our farmers,” said Bill Northey, USDA’s undersecretary for farm production and conservation. “We are doing everything we can to ensure producers receive the help they need.”

University of Illinois economist Scott Irwin said that the payment “is more generous than even I expected.”

Irwin, in an analysis posted on Twitter, estimated the top-up payment means that farmers who decided to file an insurance claim instead of planting, will get the same amount of federal aid as a farmer who planted and therefore qualifies for the administration’s trade relief package.

Based on Irwin’s calculations, there will be Illinois farmers, for example, who could gross more than $500, or even $600, per acre this year on corn they didn’t plant.

Irwin said that if he were a farmer who planted corn “in the mud” after June 5, rather than going the prevent plant route, “I think I would have a right to be upset about the muddled communication regarding having to plant to get the (market facilitation program) payment coming out of the USDA in late May/early June.”

Theoretically, a farmer who didn’t plant a crop this year could collect money from several different federal programs: crop insurance and the extra top-up, disaster aid authorized by Congress, and trade aid for any cover crops.

Source: Politico