Despite trade disputes and steep declines in commodity prices, farmers and ranchers can continue to count on commodity, risk coverage and price loss protection thanks to the passing of the 2018 Farm Bill.
“The fact a $867 billion bill was passed with strong bipartisan support at a time of political division is a win for farmers and ranchers,” says James Nygren, legislative affairs officer with Farm Credit Services of America. “It sends a strong message to farm country that farm legislation is still a priority.”
New bill mirrors old
In general, the 2018 Farm Bill renewed many of the same federal farm and nutrition programs that were included in the Agricultural Act of 2014.
For instance, nutrition continues to account for a little over 75 percent of farm bill spending followed by outlays related to crop insurance, commodity programs such as Agriculture Risk Coverage, Price Loss Coverage and conservation programs.
“The preservation of nutrition spending is important because it brings our urban counterparts into the discussion and keeps them motivated and interested in the bill,” says Nygren.
“Four years ago, funding support for nutrition and farm programs were considered separately. This year they were kept together, a procedural distinction that sets the current farm bill apart from 2014,” he explains.
Other notable aspects of the 2018 Farm Bill include the legalization of hemp, improved margin protection coverage for dairy producers and procedural updates that will allow producers to change their crop protection elections on an annual basis rather than over the five-year life of the farm bill.
“Although the 2018 Farm Bill is budget-neutral in terms of government spending, and offers evolutionary improvements as opposed to revolutionary changes, it presents a level of certainty in an otherwise unpredictable agricultural economic environment,” says Nygren. “Ultimately, it provides farmers and ranchers with the risk management tools they need to persevere through this tough cycle.”
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Editor’s Note: AgDirect does not finance or lease equipment to operations involved in the production of hemp. This condition applies even if the applicant produces other crops in addition to hemp.