Pardon Our Dust
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On May 19, the U.S. Department of Agriculture (USDA) issued the final rule for the $16 billion Coronavirus Food Assistance Program (CFAP). The final rule outlines how farmers and ranchers can apply for and receive direct financial assistance authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the existing USDA Commodity Credit Corporation (CCC) program.
The USDA will break down the payment calculations consistent with the funding sources. Money from the CARES Act will cover income losses, while CCC monies will be used to assist producers with the purchase of materials and facilities required in connection with the production and marketing of agricultural commodities and to remove surplus commodities from normal marketing channels. Despite the two funding sources and calculations, producers will only need to submit one application and they will receive one combined payment.
Start and End Dates
Farmers and ranchers that have suffered losses due to the COVID-19 pandemic may apply for direct payments at their local Farm Service Agency (FSA) starting May 26, 2020. Prior to visiting the FSA office, the USDA recommends completing the relevant forms at: farmers.gov/cfap. FSA will not require an acreage report at the time of application and a USDA farm number may not be immediately needed. Applications will be accepted through August 28, 2020.
Eligibility and Limits
The USDA rule allows agricultural producers who have suffered a five-percent or greater price decline, or who had losses due to market supply chain disruption, to apply for a direct payment. There is a payment limitation of $250,000 per person or entity for all commodities combined. Applicants who are corporations, limited liability companies or limited partnerships may qualify for additional payment limits if the applicant certifies that two or three members of the corporation each provide at least 400 hours of active personal management or personal active labor, in which case the corporate entity may be eligible to receive up to $500,000 (for two members) or $750,000 (for three members). The USDA dropped an earlier plan to cap payments at $125,000 per commodity.
Producers will also have to certify they meet the Adjusted Gross Income limitation of $900,000 unless at least 75 percent or more of their income is derived from farming, ranching or forestry-related activities
Commodities and Payment Schedule
USDA identified the initial commodities that are eligible for payment. The initial crops identified by the USDA as eligible for payment include:
- Non-specialty Crops and Wool: malting barley, canola, corn, upland cotton, millet, oats, soybeans, sorghum, sunflowers, durum wheat, and hard red spring wheat.
- Producers will be paid based on inventory subject to price risk held as of January 15, 2020. A payment will be made based 50 percent of a producer’s 2019 total production or the 2019 inventory as of January 15, 2020, whichever is smaller, multiplied by the commodity’s applicable payment rates.
|
Commodity |
Unit |
CARES Act Payment Rate ($/unit) |
CCC Payment Rate ($/unit) |
||||
|
Barley (malting) |
bu |
$0.34 |
$0.37 |
||||
|
Canola |
lb |
$0.01 |
$0.01 |
||||
|
Corn |
bu |
$0.32 |
$0.35 |
||||
|
Durum wheat |
bu |
$0.19 |
$0.20 |
||||
|
Hard red spring wheat |
bu |
$0.18 |
$0.20 |
||||
|
Millet |
bu |
$0.31 |
$0.34 |
||||
|
Oats |
bu |
$0.15 |
$0.17 |
||||
|
Sorghum |
bu |
$0.30 |
$0.32 |
||||
|
Soybeans |
bu |
$0.45 |
$0.50 |
||||
|
Sunflowers |
lb |
$0.02 |
$0.02 |
||||
|
Upland cotton |
lb |
$0.09 |
$0.10 |
||||
| Wool (graded, clean basis) | lb | $0.71 | $0.78 | ||||
| Wool (non-graded, greasy basis) | lb | $0.36 | $0.39 |
- Livestock: cattle, hogs, and sheep (lambs and yearlings only)
- The total payment will be calculated using the sum of the producer’s number of livestock sold between January 15 and April 15, 2020, multiplied by the payment rates per head, and the highest inventory number of livestock between April 16 and May 14, 2020, multiplied by the payment rate per head.
|
Commodity |
Unit |
CARES Act Payment Rate ($/unit) |
CCC Payment Rate ($/unit) |
||||
| Slaughter cattle—mature cattle (cattle raised for breeding purposes later sold for slaughter) | head | $92 | $33 | ||||
|
Slaughter cattle—fed cattle (average weight in excess of 1,400 pounds which yield average carcass weights in excess of 800 pounds) |
head |
$214 |
$33 |
||||
|
Feeder cattle less than 600 pounds |
head |
$102 |
$33 |
||||
|
Feeder cattle 600 pounds or more |
head |
$139 |
$33 |
||||
|
All other cattle |
head |
$102 |
$33 |
||||
|
Pigs (less than 120 pounds) |
head |
$28 |
$17 |
||||
|
Hogs (more than 120 pounds) |
head |
$18 |
$17 |
||||
|
Lambs and yearlings |
head |
$33 |
$7 |
- Dairy
- The total payment will be calculated based on a producer’s certification of milk production for the first quarter of calendar year 2020 multiplied by a national price decline during the same quarter. The second part of the payment is based a national adjustment to each producer’s production in the first quarter.
|
Commodity |
Unit |
CARES Act Payment Rate ($/unit) |
CCC Payment Rate ($/unit) |
|
Dairy |
cwt |
$4.71 |
$1.47 |
- Specialty Crops: Fruits: apples, avocados, blueberries, cantaloupe, grapefruit, kiwifruit, lemons, oranges, papaya, peaches, pears, raspberries, strawberries, tangerines, tomatoes, watermelons; Vegetables: artichokes, asparagus, broccoli, cabbage, carrots, cauliflower, celery, sweet corn, cucumbers, eggplant, garlic, iceberg lettuce, romaine lettuce, dry onions, green onions, peppers, potatoes, rhubarb, spinach, squash, sweet potatoes, taro; Nuts: almonds, pecans, walnuts; Other: beans, mushrooms
- The total payment will be based on the volume of production sold between January 15 and April 15, 2020; the volume of production shipped, but unpaid; and the number of acres for which harvested production did not leave the farm or mature product destroyed or not harvested during that same time period, and which have not and will not be sold.
|
Commodity |
CARES Act Payment Rate for Sales Losses ($/lb) |
CARES Act Payment Rate for Product that left the farm but spoiled due to loss of marketing channel ($/lb) |
CCC Payment Rate ($/lb) |
|
Almonds |
$0.26 |
$0.57 |
$0.11 |
|
Apples |
— |
$0.18 |
$0.03 |
|
Artichokes |
$0.66 |
$0.49 |
$0.10 |
|
Asparagus |
— |
$0.38 |
$0.07 |
|
Avocados |
— |
$0.14 |
$0.03 |
|
Beans |
$0.17 |
$0.16 |
$0.03 |
|
Blueberries |
— |
$0.62 |
$0.12 |
|
Broccoli |
$0.62 |
$0.49 |
$0.10 |
|
Cabbage |
$0.04 |
$0.07 |
$0.01 |
|
Cantaloupe |
— |
$0.10 |
$0.02 |
|
Carrots |
$0.2 |
$0.11 |
$0.02 |
|
Cauliflower |
$0.11 |
$0.31 |
$0.06 |
|
Celery |
— |
$0.07 |
$0.01 |
|
Corn, sweet |
$0.09 |
$0.13 |
$0.03 |
|
Cucumbers |
$0.13 |
$0.15 |
$0.03 |
|
Eggplant |
$0.07 |
$0.15 |
$0.03 |
|
Garlic |
— |
$0.85 |
$0.17 |
|
Grapefruit |
— |
$0.11 |
$0.02 |
|
Kiwifruit |
— |
$0.32 |
$0.06 |
|
Lemons |
$0.08 |
$0.21 |
$0.04 |
|
Lettuce, iceberg |
$0.20 |
$0.15 |
$0.03 |
|
Lettuce, romaine |
$0.07 |
$0.12 |
$0.02 |
|
Mushrooms |
— |
$0.59 |
$0.11 |
|
Onions, dry |
$0.01 |
$0.05 |
$0.01 |
|
Onions green |
— |
$0.30 |
$0.06 |
|
Oranges |
— |
$0.14 |
$0.03 |
|
Papaya |
— |
$0.32 |
$0.06 |
|
Peaches |
$0.08 |
$0.32 |
$0.06 |
|
Pears |
$0.08 |
$0.18 |
$0.03 |
|
Pecans |
$0.28 |
$0.93 |
$0.18 |
|
Peppers, |