Perdue Testifies on Depressed Rural Economy

By Skylar Schneider, NFU Executive Assistant

Yesterday, the House Agriculture Committee held a hearing on rural communities and agriculture, during which U.S. Secretary of Agriculture Sonny Perdue provided an update on the state of the farm economy. In written testimony, he addressed the fact that, after a 50 percent decrease over the past four years, net farm income is at its lowest since 2002. He asserted that the farm safety net created in the last farm bill is providing support for millions of producers through the Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) programs, which provided $5.3 billion and $7.8 billion in financial assistance during crop years 2014 and 2015, respectively.

However, producers are struggling, and programs in the farm bill do not go far enough to address the current need. Secretary Perdue made a point to discuss the significant hardships facing dairy farmers and cotton producers. More than half of U.S. dairy farms have paid into the Margin Protection Program (MPP), which is meant to protect against tightening margins between dairy prices and feed costs. However, the feed ration used is not representative of the rations producers feed their cows; as such, most producers haven’t received support from this program. Financial assistance to cotton producers has also decreased, as cotton is not eligible for the ARC or PLC programs. Instead, the crop is housed within the Stacked Income Protection Plan for Producers of Upland Cotton (STAX), which in the past has only covered about 25-30 percent of cotton acres. Dairy farmers and cotton producers have been struggling for too long, and it is imperative their needs are addressed in the next farm bill.In addition to those specific issues, Secretary Perdue highlighted many financial risks facing family farmers: limited bank credit, upward-trending delinquency rates on both commercial and FSA loans, and falling land values. Absent from the Secretary’s testimony were the following three focus areas included in National Farmers Union’s 2017 Special Order of Business regarding Family Farming and Crisis Relief:

• Robust discretionary and mandatory funding for the Certified Agricultural Mediation Program, which assists agricultural producers, their creditors, and other persons to resolve disputes thereby reducing the participant’s cost associated with administrative appeals, litigation, and bankruptcy;
• Reauthorization and full funding of the Farmer and Rancher Stress Assistance Network to aid in the mental health of individuals coping with financial stress; and
• Garnering additional support for beginning farmers, who are especially vulnerable during difficult financial times.

To provide farmers with the resources and support needed to endure these tough times, National Farmers Union and Farmers Union state divisions have compiled resources, organized listening sessions, and initiated a national campaign to raise awareness for the current farm crisis. For more information on the farm crisis, resources, and Farmers Union listening sessions, visit our Farm Crisis Center.National Farmers Union appreciates Secretary Perdue’s attention to and acknowledgment of the current economic issues facing farmers and ranchers. We will continue to work with the administration and Congress to ensure necessary protections and support are included in the next farm bill.