The Hagstrom Report

Agriculture News As It Happens


Senate trio introduce farm bill commodity title

Sen. Kent Conrad, D-N.D.Sen. Max Baucus, D-Mont.Sen. John Hoeven, R-N.D.

Sen. Kent Conrad, D-N.D. | Sen. Max Baucus, D-Mont. | Sen. John Hoeven, R-N.D.

Senate Budget Committee Chairman Kent Conrad, D-N.D., Senate Finance Committee Chairman Max Baucus, D-Mont., and Sen. John Hoeven, R-N.D., today introduced a farm bill commodity title proposal that they maintain would treat Northern Plains farmers more fairly than the “shallow loss” and higher target prices that have already been introduced, and also include disaster programs for livestock and tree producers.

The senators said in a news release that they are working to get their proposals incorporated into the new farm bill. The Senate Agriculture Committee appears to be aiming to mark up that bill the last week of April.

The Revenue Loss Assistance and Crop Insurance Enhancement Act of 2012 would create a Revenue Loss Assistance Program (RLAP) by combining the Supplemental Agricultural Disaster Assistance (SURE) and Average Crop Revenue Election (ACRE) into one program, the senators said in the release.

RLAP would work in conjunction with crop insurance to provide farmers with assistance for losses between 12 and 25 percent of their average historic revenue. An eligible loss could be due to any combination of decreased yields, declining prices or quality discounts. The program is based on individual farm performance, rather than an area trigger, and assistance would be provided on a commodity specific basis.

“RLAP is designed to address two of the primary shortcomings of the federal crop insurance: program deductibles that greatly exceed the operating margins for a crop and the lack of adequate coverage during multi-year price declines,” the senators said.

They also said the program would provide assistance for farmers who suffer losses on acres planted for harvest at a 65 percent payment rate. For acreage unable to be planted due to adverse weather, the payment rate would be 45 percent. Total acreage covered under RLAP for a producer would not be able to exceed that producer’s total base acres.

The legislation would also establish a Supplemental Coverage Option (SCO), along with other improvements to crop insurance. SCO would allow producers to obtain area-wide federal crop insurance coverage in addition to the individual coverage they currently purchase.

In addition, the new legislation would extend the SURE programs for the 2012 crop year with a modification to expedite crop revenue loss payments by about one year. It would also permanently extend the three livestock disaster programs and the Tree Assistance Program authorized in the 2008 farm bill.

The legislation would continue, with minor modifications, the commodity marketing loan program and counter-cyclical program while ending the direct payment and Average Crop Revenue Election programs beginning with the 2013 crop.

“This legislation achieves my two main goals in a new farm bill — it maintains a strong safety net for producers while, at the same time, contributing to deficit reduction," Conrad said. "This proposal complements crop insurance, is much easier to administer than current farm programs, and gives our family farmers the support and flexibility they need to succeed.”

Baucus said he has spent a lot of time traveling around Montana, talking to producers about what’s important to them. “Things like the livestock disaster assistance program we created in 2008 and a fair plan to chip in on deficit reduction, while still making sure our farmers and ranchers are protected from volatile markets and weather.”

“This bill is written with the direct input of the farmers and ranchers out there getting dirt under their nails every day to keep food on our tables, and I look forward to working with our colleagues to roll these priorities into a larger farm bill we can all be proud to support,” Baucus said.

“This is bipartisan legislation that provides a cost-effective safety net for our farmers with enhanced crop insurance,” Hoeven said. “It will serve our producers well and at the same time help with deficit reduction.”