Thursday’s disaster aid package rollout was good news for agriculture but
many of the details are still uncertain. The total aid amount could come
in at $16 billion and will cover a wider range of crops than last year’s
aid to farmers. However, the administration didn’t disclose some key
details like just how much money individual farmers and ranchers will get
in cash. Politico says $14.5 billion is being earmarked for direct
payments to producers. USDA developed a new and more complex formula for
calculating producers’ compensation to remove incentives for planting
certain crops. Instead of being tied to what farmers actually grew in
2019, they’ll be computed on a county-by-county basis. Officials say
they’ve estimated the amount of damage inflicted on producers by trade
disputes and will then multiply that by the acreage planted in the area.
Farmers who don’t plant a crop this year won’t be eligible for cash
assistance. This will likely complicate things for Midwest producers
who’ve been battling rain this spring while trying to plant. The USDA’s
trade aid package could encourage them to try to plant anyway. The
president says the aid would be paid for by the tariffs that China is
paying into the U.S. Treasury. That’s not the case. Ag Secretary Sonny
Perdue says the USDA will tap into the Commodity Credit Corporation, which
has broad authority to stabilize the farm economy.

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