We share new plans and changes suggested during the House Ag subcommittee hearing. To view this email as a web page,
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House Ag subcommittee hearing finds groups all over the place in suggestions on new farm bill. The only consensus about what should be changed in writing a new farm bill is that there is no consensus. Commodity group representatives were all over the map on the topic during the lengthy hearing. Some suggestions included: Voluntary updating of base acres, including the frequent topic of how to get base for some producers who are beginning farmers and others who have altered plantings in recent years. Mostly opposition to setting farm program payments on planted acres versus base acres as is currently the case. Increasing reference prices and/or modifying the escalator, with corn growers acknowledged any major change would cost a lot if triggered. NCGA President Tom Haag said it would take “a lot of money” to increase the statutory reference price for corn, which is now $3.70 a bushel, considerably below what he said was a $5 breakeven price. FAPRI estimates the effective reference price for corn will rise to $4.01 in 2024 for corn and hit $4.25 by 2026, because of recent increases in market prices. Some said an across-the-board hike in reference prices may not be necessary. Timing of reference prices increases were also called into question, with a wheat producer noting increases in reference prices due to the escalator provision happen well after market prices have dropped and growers need help, especially with rising costs of production. Some groups want increases in marketing loan rates. A commonsense acknowledgement by one witness that the decision each year to pick ARC or PLC is simply not worth the time, especially if others must agree with the decision. The suggestion: Make payments from whichever program provides growers with the most money in a given year. This would come at a cost that no one detailed. Bottom line: No one says it, but it may be time to simply start all over and construct totally new safety net programs to better reflect the new world conditions and have them be more flexible than the current version.
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