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Senate wrestles with commodity programs

At the end of about five hours of testimony on commodity programs for the next farm bill,  Senate Agriculture Committee Chairwoman Debbie Stabenow left the meeting Thursday with one parting comment to reporters’ questions about how soon her committee will write legislation.

“I say as soon as possible,” Stabenow said. “ Within weeks.”

If there’s any consensus among farm organizations this year, Stabenow is responding to it – a push for a farm bill written this year.

Beyond that, the really tough part of finding a way to satisfy different commodities and regions remains. At the Thursday hearing, delayed by a day due to votes on a transportation bill, most  farm groups supported continuing the current crop insurance program and adding on some form of “shallow loss” program to make up for multiple years of crop losses.

American Farm Bureau Federation is still promoting a significant change, government support for “deep losses” below 75%, with private crop insurance making up the difference at higher levels. But Farm Bureau President Bob Stallman said Thursday that his board has voted to work with other groups to improve the shallow loss proposals, even though they still prefer the deep loss program.

Commodity groups still have their own variations of a shallow loss program.

The National Association of Wheat Growers supports a revenue program modeled on the current farm bill’s ACRE and SURE programs, the group’s president, Erik Younggren said.

“We support multiple safety net programs, including a disaster program,” he said. Earlier this week, Younggren told that even though his group feels wheat farmers were helped by the current disaster program, known as SURE, they would like to speed up the process of getting paid, perhaps basing payments on the first five months of market prices, not the full year that now delays payments to farmers for about 18 months after a disaster hits.

Pam Johnson, president-elect of the National Corn Growers Association, said her group wants to build on the concept of the ACRE program from the last farm bill and that it likes the aggregate risk and revenue management (ARRM) proposal introduced  last fall by Senators John Thune (R-SD), Sherrod Brown (D-OH),  Dick Durbin (D-IL) and Richard Lugar (R-IN).

Johnson suggested that commodity groups are coming together on the farm bill.

“I think the general consensus is we’re looking to expand revenue programs that would be more effective for each of the crops represented at this table,” she said

The other crops represented at her table included soybeans, rice, peanuts and cotton.

Growers of some of those crops are having a tougher time working with a shallow loss revenue program that would supplement crop insurance payments.

As Jimbo Grissom, president of the Western Peanut Growers Association explained to the panel, peanut growers have not had viable revenue insurance from crop insurers because they aren’t traded on futures markets and there is no reference price.

The group next month will propose to USDA’s Risk Management Agency that crop insurers use international peanut prices based in Rotterdam, Netherlands, as a reference price.

His group favors giving growers a choice of using counter-cyclical payments or a new revenue program in the next farm bill.

Rice is another crop with insurance problems, because flood-irrigated rice production may have little yield change from drought, but irrigation costs go up during a dry year.

“Rice farmers strongly support existing farm policy,” said Travis Henry Satterfield, a rice farmer from Benoit, Mississippi. “We wish that crop insurance worked effectively for rice.”

Current loan rates and target prices are too low and the group favors raising prices or revenue levels, as well as giving growers choices of programs they could use.

Privately, one congressional staffer told before the hearing that the Senate Ag Committee staff has a tough job of trying to make new farm programs appear simpler and easier to use in a cost-cutting environment.

“It’s a Balkanization of commodity programs that hasn’t happened in the past,” he said.

Yet, at the end of Thursday’s hearing, several farm groups were optimistic that the Senate Ag Committee will come up with something soon.

“I think we’ll start seeing a product by the end of the month,” Jon Doggett of the National Corn Growers Association told That would be some form of written document that the committee would still have to vote on, or “mark up,” as the process is called. “I think we’ll have markup in April, I really do,” Doggett said.

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