Agricultural News
OSU Ag Policy Expert Dr. Amy Hagerman Explains USDA's CFAP Program As Enrollment Begins May 26.
Fri, 22 May 2020 12:17:55 CDT
Agricultural producers received some welcome news this week when the USDA announced details for the Coronavirus Food Assistance Program (CFAP). But like most government programs it is very complex. Dr. Amy Hagerman, Assistant Professor in Agriculture and Food Policy at Oklahoma State University explained some of the detail in an interview with Radio Oklahoma Ag Network Farm Director Ron Hays Friday about CFAP.
Hagerman said producers can begin signing up for the program virtually at their local FSA offices right after the Memorial Day holiday. However, there is a ton of information the producers need to wade through before the actual enrollment can begin.
The complexity of the program starts with the definition of who and what commodity is eligible, and includes the timing of when losses occurred, Hagerman said.
Hagerman said "unpriced inventory" will be particularly important to define.
The USDA calculations on what is a qualified loss is very specific.
The weeks of Jan. 16 and April 6 were used as bookends to define the loss period.
Hagerman said this is the first week when the loss period begins and the last week the period ends. Overall loss period is from Jan. 15 to April 15.
This defined loss period has left winter wheat producers out in the cold.
Hagerman said the qualified loss is linked to futures market prices. Winter wheat prices had a little bit of recovery in the early April period, so the difference between those two weeks was only about 2 ½ percent, less than the 5 percent loss threshold.
However, Hagerman said the USDA has left the door open for additional relief from other government programs, including the farm safety net aspects of the farm program.
The OSU ag policy expert said it's important to understand there are basically two pots of money making up the $16 billion government relief fund.
"At the end of the day, producers will get a single payment. It's important to understand the payment comes from the two pots of money and how it is broken out from those pots," Hagerman said.
For cattle producers, their sales from Jan. 15 to April 15, will be under the CARES Act funds, Hagerman said. But then April 16 to May 14, the $33 they will be paid on their highest inventory, including calves on the ground, comes from a different pot of money.
Timing is critical based on individual management programs.
Hagerman said if cow/calf producers had cows and unweaned calves born last spring and sold before April 15, they would receive $139 per head.
But if producers continued to graze the cattle another few days past April 15, they would receive only that $33 inventory payment.
Diversified producers, with both cattle and other commodities, can receive a maximum of $250,000. Incorporated farms with multiple partners would receive that much for each partner with a maximum of three qualified entities.
Hagerman said the first payment will be 80 percent of the eligible amount, and the remaining 20 percent will be paid out if there is enough money left in the pot.
She added there will be a lot of pressure on FSA office staff because it is very complex program.
To ease the burden on both sides, she encourages producers to make your appointment with the FSA office and then start compiling all the required documents as it will be awhile before they can get to your specific appointment. You have 60 days to get all the documents submitted.
Hagerman said OSU Extension is partnering with the FSA on a series of webinars to help producers understand the program. The first webinar is scheduled for May 26.
For more information on how to register for the webinars, click here.
To hear more of Dr. Hagerman's interview with Ron, click on the listen bar below.
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