National Farmers Union President Roger Johnson Urges Senate Ag to Strengthen Farm Bill Safety NetTue, 25 Jul 2017 13:11:07 CDT
Family farmers and ranchers are enduring a severely depressed farm economy, with projections pointing to a prolonged period of depressed commodity prices. To ensure the growth and success of family farm agriculture, Congress must strengthen the overall farm safety net, National Farmers Union (NFU) President Roger Johnson told the U.S. Senate Committee on Agriculture today.
You can view Johnson's full written testimony, here, or you can listen to his delivery of it before the Senate Ag Committee from this morning, by clicking or tapping the LISTEN BAR below at the bottom of this story.
In his oral testimony to the Committee’s hearing on “Commodities, Credit, and Crop Insurance: Perspectives on Risk Management Tools and Trends for the 2018 Farm Bill,” Johnson urged senators to improve the farm bill safety net, protect crop insurance, and improve access to credit.
“We continue to witness pressure in the countryside as commodity prices remain low and farmers and ranchers struggle to adjust,” Johnson told members of the Committee. “We are three years into this downturn, and forecasts by USDA point to a prolonged period of depressed prices. Given this scenario, NFU believes that the farm bill safety net should provide meaningful assistance in two fundamental circumstances: when disaster strikes and when prices are low and remain below the cost of production for extended periods of time. These two scenarios have separate solutions, the first is crop insurance and the second is commodity programs.”
Johnson noted that much discussion and debate around the 2018 Farm Bill has centered on programs that fit a particular budget. “Using the budget as a starting and ending point for the nation’s agriculture safety net is problematic from our perspective,” he said. “Feeding the nation is a national security priority and should be treated as such.”
To that end, Johnson urged the Committee to raise reference prices under the Price Loss Coverage (PLC) program, improve the operability of Agriculture Risk Coverage (ARC), return cotton as a covered commodity, and rework the dairy safety net.
Johnson also stressed the vital importance of crop insurance, an essential risk management tool for family farmers, which is constantly under threat of budget cuts in Congress. He applauded changes contained in the 2014 Farm Bill pertaining to the policies such as the Noninsured Crop Disaster Assistance Program (NAP) and Whole Farm Revenue Protection (WFRP), which have proven an important springboard for farmers, especially beginning farmers, into crop insurance.
“We should continue to look for ways to incentivize wider adoption of risk management tools through the Farm Bill,” he added.
Finally, Johnson emphasized the need to provide producers with access to credit, especially during times of financial strife. He noted that in fiscal year 2016, the U.S. Department of Agriculture (USDA) Farm Service Agency (FSA) set a new record across its loan portfolio, with obligations of direct and guaranteed operating and farm ownership loan funds reaching $6.3 billion.
“At the same time servicing metrics associated with the program got worse as delinquencies rose across the portfolio and debt restructuring increased,” Johnson said. “Among private sector lending, confidence is down and stress on portfolios are up according to both public and private reports. Nearly 90 percent of agricultural lenders have seen an overall decline in farm profitability in the last 12 months.”
“There are many challenges facing agriculture today,” Johnson concluded. “This committee has a challenging task ahead of it as it begins to grapple with these problems. The farm bill safety net needs to be improved, crop insurance needs to be protected, and access to credit needs to be increased all for the benefit of family farmers. Our collective challenge is to continue working to provide help when and where needed – and to encourage the continued growth and success of our most vital industry – agriculture.”
Source - The National Farmers Union
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