27 April, 2007

USA: Farm bill proposal unfair to barley producers

U.S. Secretary of Agriculture Mike Johanns recently revealed the U.S. Department of Agriculture's proposal for the 2007 farm bill, High Plains Journal published April 19. While some of the proposals will benefit Montana producers, inequities between barley and other commodities remain. "It is extremely frustrating that Secretary Johanns has acknowledged that barley producers have not been treated as fairly as other commodities by the 2002 farm bill, yet he has missed this opportunity to correct the problem," stated Lola Raska, MGGA executive vice-president.

While we agree that an increase in direct payments is needed, the proposed 7 percent increase for barley is not sufficient to meet recent increased production costs. USDA also proposes a decrease barley loan to $1.70. Replacing the current price-based counter-cyclical program with a revenue-based program that uses national revenue and yields as a trigger is a change that we have determined does not benefit Montana producers who see successive years of variable production.

USDA wants to strengthen payment and eligibility limits by substantially decreasing the Adjusted Gross Income cap to 200,000 annually. The current provision that waives the cap if 75 percent or more of the AGI is derived from farming or ranching would be repealed. The three-entity rule would be eliminated and payment limitations would be adjusted with an increase in the direct payment limit and decreases in the payment limits for counter-cyclical and marketing loan gains.

We are pleased that USDA is proposing additional incentives for beginning farmers, consolidation of current conservation programs and expansion of the Conservation Security Program. Increased funding for renewable energy research and bio based projects should benefit Montana producers over the course of the new farm bill. Raska stated, "We are also very interested in learning more about the proposed "gap" insurance coverage that would allow a producer to cover 100 percent of production losses."

MGGA will continue to analyze the new proposal and will work with our congressional delegation to negotiate a 2007 farm bill that will be more equitable to Montana's grain producers.

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