Farm Bill Impact | February 2014
Updated: Nov 1, 2018
At a time when the U.S. Congress is often criticized for its lack of progress on key issues, farm leaders in Kentucky and across the nation are heaping praise on federal lawmakers for passage of a new farm bill.
The Agribusiness Industry Network heard from one of those cheering the ag policy rewrite at its Feb. 14 meeting in Louisville.
Penton Media Vice President Greg Frey told the AIN audience that the 2014 farm bill represents a sea change in federal farm programs, providing farmers options for needed financial protection while at the same time reducing costs to taxpayers.
Frey, whose firm publishes a number of state and regional commodity publications and conducts farm progress shows, said the 900-page bill ends direct payments to farmers and sets up a new crop insurance structure which allows farmers to choose between whole farm revenue protection or guarantees against precipitous declines in individual commodity prices. The legislation also gives permanent status to several livestock assistance programs and creates new provisions to assist fruit and vegetable growers, including those in the organic market. Frey said the two crop insurance options in the new legislation are: Ag Risk - Coverage-This option insures against whole-farm revenue falling below guaranteed level Price Loss - Coverage-Here the producer is assured of recouping at least his production costs if commodity prices dip below pre-set targets Frey noted that projections of larger grain stocks and falling prices for 2014 may make the new protections almost indispensable for corn and soybean producers going forward. Cattle prices are headed in the opposite direction, he noted, with feeders topping $165 per hundred in some markets, an all-time high. This trend follows six straight years of 5 percent declines in beef herd numbers, which are now at 1920's levels. There are some indications of a slight turnaround in those numbers, but don't expect a significant bump, he said. The beef industry seems to be in no hurry to rebuild herds, but that could change if this year's anticipated retail price spike drives customers to other meat choices, he said. Whatever the direction of prices, most producers will welcome the new farm programs for the long-term stability they provide. "At least for the next five years, we all know what we're dealing with," Frey said. "Stability is what the industry needs, and predictability that production and investment decisions long term can be made with a degree of certainty. That's the best news for farmers and for consumers as well."
Gary Huddleston | AIN Chairman