Generic farm with money

The federal government on May 19 gave additional details on the Coronavirus Food Assistance Program, which will send up to $16 billion in direct payments to farmers and ranchers affected by the coronavirus outbreak.

For non-specialty crops, such as corn, oats, soybeans and wheat, producers will be paid based on inventory subject to price risk held as of Jan. 15, 2020. A payment will be made based on 50% of a producer’s 2019 total production or the 2019 inventory as of Jan. 15, 2020, whichever is smaller, and multiplied by the commodity’s payment rates.

The program uses funding rates from the Coronavirus Aid, Relief, and Economic Security Act, known as the CARES Act, and the Commodity Credit Corporation.

Using the average of the two, corn will have an effective payment rate of 33.5 cents per bushel, and soybeans will have an effective payment rate of 47.5 cents per bushel. Wheat is at 19.5 cents per bushel, and oats are at 16 cents.

Livestock will have a total payment calculated by using the sum of a producer’s livestock sold between Jan. 15 and April 15 of this year, multiplied by payment rates per head, and the highest inventory number of livestock between April 16 and May 14, multiplied by the payment rate per head.

The dairy payment will be calculated based on milk production in the first quarter of 2020 multiplied by national price decline during the same quarter. The second part of the payment will be based on a national adjustment to each operation’s production in the first quarter.

Producers could being applying through their local FSA office starting May 26. Applications will be accepted through Aug. 28.

The payments will be structured so producers get the majority of their money earlier. They will receive 80% of the payment upon approval of the application.

“America’s farming community is facing an unprecedented situation as our nation tackles the coronavirus,” U.S. Secretary of Agriculture Sonny Perdue said in a news release. “President Trump has authorized

USDA to ensure our patriotic farmers, ranchers, and producers are supported and we are moving quickly to open applications to get payments out the door and into the pockets of farmers. These payments will help keep farmers afloat while market demand returns as our nation reopens and recovers.”

Spencer Tuma, director of national legislative affairs for Missouri Farm Bureau, says the program is appreciated, although concerns remain.

“Missouri Farm Bureau appreciates the attention the Administration and USDA are giving to farmers and ranchers who have suffered economic losses due to COVID-19,” he said. “While we are grateful for the assistance, we worry about the additional burden this will place on local USDA county offices who are tasked with administering this program which, although helpful, is very complex in nature. We are reviewing the rule and working to get questions answered that will help provide clarity for our members.”

Ag groups characterized the assistance as a “first step” to helping farmers.

“The COVID-19 pandemic has led to much uncertainty across farm country,” National Corn Growers Association President Kevin Ross said. “This assistance is a first step to getting farmers, and our customers, back on solid footing.”

Ben Herrold is Missouri field editor, writing for Missouri Farmer Today, Iowa Farmer Today and Illinois Farmer Today.