Senate Democrats say the Trump administration’s trade assistance is unfairly benefitting large growers and Southern farmers to the detriment of producers more deserving of the aid.
A report released Tuesday by the top Democrat on the Senate Agriculture Committee, Debbie Stabenow (shown above), and Minority Leader Charles Schumer of New York alleges that the “flawed formula” the Agriculture Department is using to make payments under the 2019 version of the Market Facilitation Program “picks winners and losers between regions and crops. And while the impacts of the retaliatory tariffs are widespread, the payment rates have not aligned to help the regions and crops harmed the most.”
Stabenow, Schumer and 13 other Democratic senators separately signed a letter to Agriculture Secretary Sonny Perdue asking him to correct the inequities they see in the design of MFP.
Perdue announced last week that the department would soon make the second round of payments under the 2019 MFP. A third round in early 2020 is also possible.
The Senate Democrats’ report says that because of their relatively high payment rates, farmers in Georgia have already received more than $50 per acre in the first round of 2019 payments, while farmers in 34 other states received $25 or less. Farmers in 14 states received $10 or less.
The payments are based on USDA’s estimate of the impact of the tariff war with China and other trade problems on each individual county based on the mix and volume of commodities that county produces. According to the Democrats’ report, county payment rates equaled or exceeded $100 per acre in 193 counties, 184 of which are in the South.
To see a map of county-by-county payment rates Agri-Pulse produced following USDA's announcement, click here.
The report also alleges that MFP was unfairly tilted to some commodities, such as cotton, over others. Areas with cotton qualified for a high MFP payment even though the average price of the commodity rose 3.9 cents to 72.5 cents per pound for the 2018 marketing year, while the average price for soybeans fell 85 cents to $8.48 per bushel, the report said.
USDA issued a statement Tuesday defending the program’s design, noting that farmers in the Midwest have received more than 60% of the MFP payments so far. and that top five states for payments are Illinois, Iowa, Kansas, Nebraska and Minnesota.
“While we appreciate feedback on this program, the fact of the matter is that USDA has provided necessary funding to help farmers who have been impacted by unjustified retaliatory tariffs,” the statement said.
The letter to Perdue was signed by Stabenow, Schumer, Dick Durbin of Illinois, Tina Smith of Minnesota, Patrick Leahy of Vermont, Gary Peters of Michigan, Tammy Duckworth of Illinois, Robert Casey of Pennsylvania, Sherrod Brown of Ohio, Tammy Baldwin of Wisconsin, Patty Murray of Washington, Kirsten Gillibrand of New York, Kamala Harris of California, Amy Klobuchar of Minnesota and Jeff Merkley of Oregon.
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