USDA’s Market Facilitation Program Leaves Small Farms Behind
In the most recent round of federal funding, U.S. trade aid has mostly benefited large corporate farms, despite the government’s promise to help America’s small farmers. In 2018, when the U.S. trade war with China began, a trade bailout program was instituted specifically to help family farms survive the trade the anticipated reduction in demand for U.S. agricultural products. While direct payments were supposed to help small famers, roughly two-thirds of those payments went to the top 10% of recipients at the start of the year, according to U.S. Department of Agriculture records. The top half of recipients received 95% of the $28 billion allocated to the Market Facilitation Program. The top tenth of recipients received an average payment of $164,813. Yet, the average payment for the bottom half of recipients was only $2,469.49. The USDA increased the limit for individual payments from $125,000 to $250,000, however, corporate farms have exceeded that upper limit. The top 1% of the program’s beneficiaries got 17% of total trade relief over the most recent two-month span of payments, with an average payment of roughly $455,600, according to CNBC’s analysis.
USDA Tightens Eligibility Rules For Farm Subsidies
In an effort to close a few loopholes, the USDA is tightening up its subsidy rules by limiting who can collect a payment a “farm manager.” The new regulation requires at least 500 hours of management or at least 25% of management work annually in order to receive a subsidy check. “This is way stronger than what we had before this week,” said Ferd Hoefner of the National Sustainable Agriculture Coalition. Prior to the new regulation, subsidy checks could be given as long as farming operations were profitable. Subsidy recipients can collect up to $125,000 a piece, and spouses are automatically eligible for payments as well.
USDA Adds $1 Billion To Farmers To Families Food Box Program
Last week, the U.S. Department of Agriculture was given an additional $1 billion to its program redirecting surplus food from farmers to families in need. The Farmers to Families Food Box program purchases food directly from farmers who typically would be supplying restaurants, most of which are now shut down or operating at reduced capacity. The program delivers the redirected food to millions of Americans struggling to make ends meet as a result of furloughs and joblessness caused by the pandemic. In July, Reuters reported that the government had not delivered its promised amount of food by the end of June as part of the roughly $3 billion program announced in April. The latest infusion of funds helps meet the stated goals of the Agriculture Department, which plans to finish purchasing roughly $2.7 billion of food by the end of August, according to the USDA website. On Monday, the White House said that the program had delivered more than 70 million boxes of food to food banks and nonprofit organizations to date. Even though it is getting closer to meeting its objectives, the program has been criticized by food banks, market analysts, and some U.S. senators, who say that contracts were often given to inexperienced vendors who could not source and deliver the food efficiently.
High-Tech Produce Greenhouses Begin Supplementing Traditional U.S. Agriculture
In Kentucky, a 2.76 million-square-foot facility is being built on 60 acres of land using environmentally-friendly techniques to help feed the country while adapting to a changing climate. Jonathan Webb, founder and CEO of the high-tech greenhouse company AppHarvest, says, “By 2050, we’re going to need 70% more food. [The University of California at] Berkeley says we will need two planet Earths to have enough land and fresh water to produce that food.” Webb added, “We got the United Nations saying we have 60 years left of topsoil before the topsoil is degraded to a point to where it’s not going to be very fertile.” According to AppHarvest, the eastern region of Kentucky is the ideal location for distributing produce to 70% of America’s population in a one-day drive. Another company, Kentucky Fresh Harvest, has also positioned itself in Kentucky with its own high-tech greenhouse. The 30-acre, $13.5 million Kentucky Fresh Harvest facility is located in Stanford and takes some of its inspiration from the high-tech, high-output greenhouses currently used in the Netherlands. That country is the size of Connecticut yet it became the world’s second-largest agricultural producer through its agricultural technologies. After the famine of World War II, the Dutch pledged to produce twice as much food with half the resources. Through its advanced greenhouses, they have drastically reduced the amount of water required on key crops by 90% while cutting the use of chemical pesticides on plants.
Second Worst Wildfires Ever Halt California Wine Country Harvest
Wineries in Sonoma County, Napa Valley and the Santa Cruz Mountains all began battling wildfires earlier this week after 12,000 lightning strikes hit the area. “It’s the perfect storm,” said Tony Bugica, director of farming for Atlas Vineyard Management, which farms 3,500 acres on California’s North Coast. The fires around Napa (known as the LNU Lightning complex) have already burned 1.1 million acres, making it the second largest fire in the state’s history. “2020 is like nothing we’ve ever been through,” added Bugica. Even without the recent wildfires, excessive heat had already put pressure on the ability of vineyards to maintain quality standards, said Bugica. Temperatures in some northern areas are regularly reaching above 100ºF during the day. Five people have died in the blaze, more than 1,000 businesses and residences have been destroyed or severely damaged, and the 2020 Sonoma County grape harvest has been put on hold. In addition to the destruction, wildfires also bring the unique threat of smoke taint, a phenomenon that happens when smoke lingers in the air, settles on grapes, and imparts an irreversibly smoky flavor to the wine. “We’ve been lucky so far when it comes to smoke taint,” said Dave Golnick, owner of Mindego Ridge Vineyard. Coupled with the pandemic pressures of diminished tourism, tasting room closures, and social distancing restrictions, recent wildfires in wine country have challenged California’s wine industry like never before. Meanwhile, southeast of San Francisco, another fire called the SCU Lightning Complex is currently the third largest fire the state has ever seen.
U.S. Farmers Leave Fields Fallow As Pandemic Crushes Crop Prospects
From March to June this year, U.S. corn plantings dropped by the most in 37 years, according to the U.S. Department of Agriculture (USDA). The decrease is due in part to low demand for corn-based ethanol as travel remains restricted throughout the country. Many farmers have abandoned plans to seed other routine crops as well. Plantings of cotton crops also dropped by 10.9%, according to USDA data. “I think this may be a one-off year,” said Michael Cordonnier, president of the Soybean and Corn Adviser consulting group. “You had the pandemic. There was just a general economic malaise. It just made everybody risk-averse,” he added.
Shifting government subsidies have also influenced farmers’ decisions to leave their fields fallow. The federal aid program was meant to compensate farmers for lost sales to China during the trade war. But those payments were based on total planted acreage for 2018 and 2019. This year’s low sales forecasts have snuffed out any incentive to get more crops in the ground. “It costs money to put a crop out,” said Jim Gerlach, president of A/C Trading. “It is better to make nothing than to lose money.”
How Suffering Midwest Farmers May Determine The Presidential Election
Four years ago, America’s newly elected president promised to change the economic decline of the nation’s family farmers. However, in early 2018, the administration initiated a series of trade wars that prompted China, Mexico, Canada, and the European Union to enact tariffs on U.S. agricultural products. Canada discontinued all dairy imports from the United States. Mexico, the largest importer of Wisconsin cheese, enacted a 25% tariff on U.S. cheese that clobbered the industry at a time when closed restaurants and event venues had already soured sales of cheese and milk. While the administration did allot fifteen billion dollars in financial relief to struggling U.S. farmers, most of the money has gone to large multinational corporate farms. As a result, America’s dairyland of Wisconsin has become a re-election battleground state. Due to widespread school and restaurants closures, many of the state’s dairy farmers have been forced to cancel lucrative contracts with milk bottlers and cheese factories. By late April, one Wisconsin farm had already dumped more than five million pounds of surplus milk. The price of milk has since plummeted by over 30%, and Wisconsin farmers are looking to our country’s leaders for solutions to a deepening problem.
Midwest Derecho Devastates More Than 37 Million Acres Of Iowa Crops
A storm with hurricane-like winds (a derecho) impacted about 37.7 million acres of Midwestern farmland Monday, according to the Iowa Soybean Association (ISA) and the U.S. Department of Agriculture. The storm affected 8.18 million acres of corn and 5.64 million acres of soybeans, according to ISA data. Farmers are trying to pick up the pieces, from flattened cornfields to smashed steel storage bins. The derecho impacted 58,000 holders of Iowa crop-insurance policies with a total liability of about $6 billion.
Salmon Crisis Stokes Protests In Russia
Russia’s Amur River was once teeming with salmon. However, most of the fish are now gone, according to coastal residents, after Moscow permitted fishing corporations to hang enormous nets at the river’s mouth. Depleted fish stocks have angered Russians so much that they have fueled anti-Kremlin protests in the Far Eastern city of Khabarovsk since early July. President Vladimir Putin’s support there has sunk to a low point during his 20-year rule. Residents say that regulations on recreational and Indigenous fishing have compounded the problem, becoming so strict that it is nearly impossible to legally catch enough fish to subsist on, something the local population has been doing for centuries. Due to commercial overfishing, total salmon catches in the area dropped from 64,000 metric tons in 2016 to 21,500 tons in 2018, According to the World Wildlife Federation (WWF). Olga Cheblukova, Coordinator of WWF’s Amur River studies, said that the decline of wild salmon after 2016’s large catch went largely unnoticed due to poor federal oversight. For the past few years, regulators have also granted fishing quotas above the actual migrating population of the fish, essentially exterminating the salmon before they could reproduce. Protests in Khabarovsk are now in their second month.
Federal Relief Package Shortchanges America’s Small Regional Farmers
In March, Congress approved a multibillion-dollar bailout for farms taking losses due to the pandemic, leaving the Agriculture Department to decide where money would be spent. Two months later when the plan was released, Agriculture Secretary Sonny Perdue said its $16 billion would be a “lifeline” for farmers of “all sizes and all…production.” An NBC News analysis found that the initial estimated 700,000 payments, which totaled $5.6 billion, has strongly favored large farms over small ones. Data also revealed that corporate farms used loopholes to acquire large sums, and substantial payments were made to foreign-owned operations. As a result, numerous struggling farmers remain ineligible without access to any Congressional funds.
Some telling numbers: the top 1% of recipients received a total of $1.2 billion, which is over 20% of the total funds made available. Also, the top 10% received 60% of the money, leaving the bottom 10% with just 0.26%. While the top 10% of recipients received average payments of $95,000, the bottom 10% averaged around $300. Nearly 2,300 operations received $250,000, the payment cap for a single farm. However, the Agriculture Department allows single farms to receive as much as $750,000 if three shareholders each spent over 400 hours working in the business. Experts claim there is no limit on payments for farms organized as “general partnerships,” due to a loophole in farm subsidy policy. This presumably explains why the Titan Swine hog farming partnership received more than $2.5 million and five other large farming operations got $1 million or more each.
