Not long after Agriculture Secretary Sonny Perdue announced details of a support package for farmers, Scott Stiles’ phone started ringing.
On Wednesday, the U.S. Department of Agriculture rolled out the Market Facilitation Program, Food Purchase and Distribution Program and Agricultural Trade Promotion Program, all intended to help farmers affected by the international battle over tariffs.
“The phone never stopped ringing with farmer questions about the Market Facilitation Program,” said Stiles, an extension economist for the University of Arkansas System Division of Agriculture. “Questions largely revolved around the timing of sign-up and how the payments will be split and whether prevented planting acres qualified for the program.”
“There was a lot to digest,” he said.
Here are some key points to the Market Facilitation Program. More information is available from USDA:
Eligible acres must be planted by Aug. 1 to qualify for MFP.
Program signup opens July 29 and ends Dec. 6.
Payments are based on 2019 planted acres. “As long as a Farm Service Agency approved cover crop was planted on prevented planting acres, those acres are eligible for a $15 per acre payment,” Stiles said.
Qualifying crops include: alfalfa hay, barley, canola, corn, crambe, dried beans, dry peas, extra-long staple cotton, flaxseed, lentils, long grain and medium grain rice, millet, mustard seed, oats, peanuts, rapeseed, rye, safflower, sesame seed, chickpeas, sorghum, soybeans, sunflower seed, temperate japonica rice, triticale, upland cotton, and wheat.
Dairy and hog producers are also eligible. Hog producers will receive $11 per head, based on inventory between April 1 and May 15, 2019. Payments to dairy producers will be based on historical production with a rate of 20 cents per hundredweight.
Total MFP payments capped at $250,000 per person or legal entity.
Other details may be found at http://bit.ly/MFP2019AR.
What’s in it for Arkansas?
The program payment rates will vary by county. These rates were based largely on historical production. Nationwide, the payment rates vary from $15 per acre to $150 per acre.
“In Arkansas, the payment rates range from $19 per acre to $134 per acre, with $66 being the average across 57 eligible counties,” Stiles said.
Thirteen counties had payment rates of $100 or more “surprisingly, these weren’t all Delta counties, he said. Cleveland, Stone and Sharp were in this group.”
A list of county payment rates may be found here: County rates are available at: https://www.fsa.usda.gov/programs-and-services/market-facilitation-program/index.
What can farmers expect?
The first payment will be the higher of either 50 percent of a producer’s calculated payment or $15 per acre.
The first payment will be made in mid-to-late August.
MFP payments will be made in up to three portions, with the second and third portions evaluated as market conditions and trade opportunities dictate. If conditions warrant, the second portion will be made in November, and the third in early January.
The payments are based on certified acreage of qualifying crops.
Stiles noted that similar trade assistance was made available in 2018. However, “it was based on harvested production and a much more limited list of eligible commodities,” he said. “For 2018, these were corn, cotton, soybeans, sorghum, wheat, hogs and dairy.”
For Arkansas farmers, their corn, cotton, soybeans, sorghum and wheat acres received almost $281 million in 2018 MFP payments.
“For 2019, the MFP eligibility list has been expanded to include all Farm Service Agency covered commodities. In Arkansas’ case, rice and peanut acres for example would now be eligible for MFP payments,” Stiles said.
The National Agricultural Statistics Service “indicates we have total rice acres of 1.3 million and 45,000 peanut acres,” he said. “Based on the average per acre payment rate, the addition of rice and peanut acreage could mean another $90 million dollars to the state in MFP assistance.
“The only caveat with that statement is payment limitations,” Stiles said. “USDA is capping MFP payments at $250,000 per person or legal entity for non-specialty crops.”
For details about agricultural economics, visit www.uaex.edu, contact a county extension office or follow the agency on Twitter at @UAEX_edu.