From cotton to hogs, agriculture groups seek billions more in coronavirus aid
Tariffs, unfavorable prices and COVID-19 have battered the farm economy, groups seeking more federal dollars say
The National Pork Producers Council plans to campaign for a change in federal law that would allow the Agriculture Department to pay livestock and poultry farmers for healthy animals they euthanized because of the COVID-19 pandemic.
The trade association said Monday that it wants the provisions included in the Senate version of the next economic recovery bill with a goal of getting the language into a compromise version worked out between the Senate and the House by early August.
The council's request for aid is just one item on a wish list from the agriculture sector for direct payments to farmers and ranchers to cover lost renewable fuel revenue and a collapse in the demand for cotton, aid to meat processing plants to ensure production lines keep moving, and other items. Advocates for renewable fuels, pork and cotton relief put the COVID-19 damage at about $17.8 billion, a sum that includes at least some estimates of continuing cost in 2021.
Farm and agriculture-related groups say the pandemic, coming after several years of flat or low prices and two years of retaliatory tariffs from trading partners, has left them battered.
Congress provided $9.5 billion in appropriated funds and $14 billion in borrowing authority for the Commodity Credit Corporation in March legislation. The USDA has set aside $16 billion for direct payments to farmers and ranchers and is spending $3 billion on a program for food distributors to buy meat, produce and dairy that is boxed and delivered to participating food banks and nonprofits.
The hog group said it backs legislation by Sen. James M. Inhofe, R-Okla., to give the department’s Commodity Credit Corp. emergency authority to reimburse farmers whose cattle, hogs or poultry suddenly become surplus or excess animals are unable to be slaughtered “due to significant supply chain interruption during an emergency period.”
That bill would also cover donations of meat to noncommercial interests. Agricultural processing plants could also receive aid to ensure that meat and poultry lines keep moving during a national emergency. The bill would authorize $300 million for the Animal and Plant Health Inspection Service to address the COVID-19 issues,
Under current law, the USDA can only provide indemnities if animals are killed because they are sick or because such actions are necessary to control the spread of disease.
The Renewable Fuels Association released a July 15 report that the industry lost $3.4 billion in revenue from March through June because of COVID-19 economic disruptions that reduced driving and demand for transportation fuels. The association projected that losses could reach $7 billion in 2020 and $1.8 billion in 2021.
Ethanol’s losses also reflect a blow to corn farmers who sell approximately 40 percent of U.S crops for fuel production. The association study said the industry used 500 million fewer bushels of corn during the March through June period.
Cotton farmers, textile mills and the cotton merchandising sector also are looking for relief aid in the next economic recovery legislation.
Sens. Thom Tillis, R-N.C., and Mark Warner, D-Va., sent a letter to Senate Majority Leader Mitch McConnell, R-Ky., and Minority Leader Charles E. Schumer, D-N.Y., signed by senators from cotton-growing states last week asking that the cotton supply chain receive financial help. Tillis and Warner said COVID-19 kept people at home and depressed demand for cotton up and down the supply line.
“The collapse in cotton demand is being felt across the U.S. cotton industry from textile manufacturers to merchandisers to cotton producers, and all segments in between. The viability of the farms and businesses, and the jobs they represent, are at risk of not surviving this crisis,” the senators wrote.
“Given the precipitous decline in retail demand, the loss of textile production and lower cotton prices that are expected to persist into 2021, the economic damage to the U.S. cotton industry is currently estimated to be at least $4.0 billion,” the letter said.
The hog industry estimates that COVID-19 economic disruptions could cost pork farmers $5 billion.
“We need help now to weather this unprecedented crisis,” said National Pork Produces Council President Howard “A.V.” Roth said.
During the spring, the council said hog farmers euthanized an estimated 300,000 to 400,000 market-ready animals in the spring and another million young pigs may have been killed on farms because several slaughter plants closed temporarily as workers became ill with COVID-19 or tested positive for the virus.
The closures meant farmers were limited in how many of their animals they could get to slaughter and the market. Steve Meyer, an economist with Kerns & Associates, who joined the council's officers and staff on a press call, said conditions have improved with the reopening of plants, but the pace of processing remains slower because the facilities have spaced workers to meet social distancing requirements.
Meyer said about 2 million hogs are still waiting on farms to be moved to processing plants. Demand for pork is strong at the retail level, he said. The food service market appeared to be regaining ground as states reopened restaurants for sit-down service but Meyer said multistate surges in COVID-19 cases threaten to undo the progress.