BLOOMINGTON, Ill. — The second round of the Market Facilitation Program has created more questions than U.S. Department of Agriculture officials have provided answers.
Doug Yoder, crop agency manager for Country Financial, discussed some of the big questions and issues surrounding the second part of the Market Facilitation program payments and how those issues could impact farmers in 2019.
On More Information
They are not going to release the rules on MFP until after the July 15 acreage reporting deadline. Their announcement clarified some things. It also brought about more questions.
On Payment Rate
What the announced is that each county will have one published payment rate, no matter which of the eligible commodities you plant. You will be paid that same rate in that county. They will announce what each county rate will be, and those rates will vary from county to county, so we’ll see variations from county to county.
On MFP Eligibility
In order to get MFP, what they announced is you have to plant one of the eligible crops, and they released a pretty long list of eligible crops. They said as long as you plant one of those crops, that acre would be eligible for the payment in 2019.
They will take a look at historic county acreages, how many acres of each crop they planted and then calculate how much they think each of those commodities suffered due to this trade war we are in.
The way a farmer will get paid is they will be assigned that one county rate. They will be paid that on each eligible acre that they plant in 2019, not to exceed their 2018 plantings.
On Fallow Acres
Any acres left fallow will not be eligible for 2019 MFP payments. One of the options with prevent planting is to leave your acres fallow and you would then get your full prevented planting guarantee, which is 55% of your original guarantee. In order to get MFP, they announced you have to plant one of the eligible crops.
On Beginning Farmers
I have been contacted by several brand new beginning farmers. This is their first year farming. They have asked will they be eligible, and we simply can’t answer that yet.
I have other farmers contact me and said they farmed last year, but they picked up new acres for this year, will they be eligible for those? Again, can’t answer that.
Some of those details have not been released, and it sounds like they will not be released until after that July 15 deadline. They were very clear when they said you have to plant one of the eligible crops to be eligible for an MFP payment and your total eligible acres cannot exceed what you planted in 2018.
Some of this is subject to change, and we are getting questions. These are legitimate concerns. If you are a beginning farmer, I find it hard to believe USDA wouldn’t make you eligible.
On Planting Decisions
I know USDA wants farmers to plant based on what the market is telling them to plant and I understand that, but it’s a very fluid situation. That’s very hard for a farmer because if they make a decision to plant a crop partly because they hope to be eligible for MFP, they don’t know what the rate is going to be yet, and that means they may have to go invest in more inputs.
They have already probably partially invested in some inputs, maybe some anhydrous ammonia last fall and a few other times. When they decide to go ahead and plant that crop, they are investing a lot more money in that crop at that moment and they are doing so not knowing what that MFP payment is going to be in their accounting.