The success and popularity of the Farm Security and Rural Investment Act of 2002 was no accident.
That program provided “a balanced approach for farm groups and rural interests,” said Steve Verett, executive vice president of the Plains Cotton Growers Inc., during a panel discussion of farm policy at the recent Texas Ag Forum in San Antonio.
“This is one of the most successful (farm programs) ever created,” Verett said. “That’s no accident. It provides a stable farm policy and provides the basis for long-term investments, which is vital to producers. Support during periods of low prices provides a necessary safety net,” he said.
Verett, as did other panelists, recommended maintaining the current program for as long as possible and at least using it as the foundation for any new legislation.
He cited key points for farm programs debate, including:
· Maintain the current program through 2007. “It’s important for agriculture stability,” he said.
· Put no limits on eligibility that prevents commercially viable operations from participating.
· Maintain programs that allow planning flexibility. The market loan, for instance, aids farmers in planning crop investments. Doing away with that provision, Verett said, removes planning flexibility.
· Enhance trade. “Congress must put U.S. interests first. Also, we must have a compliance assurance provision (the old Peace Clause). “Without that, we will continue to be under attack (by trade competitors).”
· “Negotiators can’t support anything that treats cotton differently from other commodities.”
· Verifiable market access will be essential if negotiators give up farm supports. “If we give up 60 percent we have to have verifiable market access,” he said.
Matt Brockman, Texas and Southwestern Cattle Raisers Association, said the conservation title has “been extremely important to the cattle industry. But a lot of programs have overlapping objectives.”
He said the Environmental Quality Incentive Program (EQIP) “has served cattlemen well. EQIP has been effective. The state committee sets guidelines and that helps. Also, 50 percent of the available funds go to county level programs.”
He said EQIP may be even more helpful as total maximum daily load (TMDL) regulations become more stringent.
Brockman said the Natural Resources and Conservation Service technical assistance provides benefits to cattlemen. Private technical service providers, he said, “worked with limited success. Also, some funds could be better utilized. Landowners need a place they can go for help. NRCS offers the best option.”
Brockman also commented on country of origin labeling (COOL). “Mandatory reporting does not work,” he said. “It has created tremendous contention in the cattle industry. The law needs to be done in the proper context.”
John Cowan, Texas Association of Dairymen, said agriculture “needs a safety net, a support level to assure a constant supply of food at a consistent price.”
On trade, “the playing field needs to be level.” He also addressed immigration. “We need the workers but with the provision that they obtain legal status. The industry should not be required to police immigration programs.”
He agreed that EQIP has been good for the livestock industry.
“Food safety is important,” he said. “We promote safe, wholesome products. Imports, unfortunately, are not produced under the same stringent regulations we have in the United States. They (importers) need to follow the same standards.”
Dee Vaughan, Texas Corn Producers, said a number of groups “are determined to have a say in the next farm bill. Many are not concerned with what agriculture needs. Our concern is that legislation must do a good job for corn and all other commodities in Texas.”
He said the 2002 law worked well and provided an adequate safety net. “We support extending the 2002 law and the baseline.”
He said that upgrading base and yield histories in the 2002 law remains “unfinished business.” He said a sore point continues to be non-irrigated corn and soybean yields remaining in place after farms convert to irrigated acreage. “As little as one-eighth of production may be covered,” he said. “That affects other commodities, too.”
He said more emphasis on direct payments should come with an ability to upgrade base and yield. “If we lose the market loan, we may lose flexibility if we change crops.”
Vaughan said increased production costs, spurred by higher energy prices, underlines a need to improve risk management programs. “It’s difficult to forward contract because of high production costs.”
He supports a research title in any farm legislation. “We’re able to produce what we do now because of agricultural research,” he said.
Wayne Cleveland, Texas grain sorghum producers, said commodities “need to stay on the same page. We see no value in going at each others throats,” he said. “If we do that, public perception will tear us apart.”
He supports maintaining the 2002 law. ‘It’s been good for grain sorghum. I’d like to see it extended.”
He said flexibility has been a key to the program’s success but he does see areas that need tweaked. Crop insurance coverage in the Lower Rio Grande Valley, for instance, is not as good for grain sorghum as it is for cotton. “We need to re-look that discrepancy,” he said, “so we can plant a crop based on the best interests of the farmer instead of insurability.”
Cleveland said energy production could be an important component of the next farm bill. “We use 160 billion gallons of gasoline a day in the United States,” he said. “We would need 55 billion bushels of grain to replace that (for ethanol production). Last year, we used 11.5 billion bushels of grain in the United States for ethanol.” He said soybean and grain farmers would need to increase acreage significantly to replace gasoline.
He said the United States currently has 93 ethanol plants. “It’s difficult to build them. An energy bill may be as important as a farm bill.”
Cleveland said a new commodity, sweet sorghum, has potential to increase ethanol production efficiency. “We can grow it with less water than we need for sugar cane. I hope to see sweet sorghum included as a program commodity.”
Cleveland said an extension of the 2002 farm program seems to “be in play.”
Failure of WTO negotiations so far may encourage legislators to extend the law until trade agreements can be reached.