Agfax Buzz:
    January 19, 2013

    Analysis: Sequestration + Debt Limit + Continuing Resolution = Farm Bill Speculation

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    From The Rice Advocate, U.S. Rice Producers Association

    There appears to be much speculation about current legislative actions and statements in regard to the farm bill. Some reporters are projecting the wildest motives or outcomes in regard to the future of the farm bill.

    At this point in time, the largest unknowns with the greatest ability to influence the farm bill process are the BIG 3—sequestration, debt limit, and continuing resolution. All of these are fiscal imperatives that can greatly influence the farm bill either individually or collectively and must be addressed in some manner early this year.

    The optimal result of the culmination of these 3 imperatives would be some type of overall budget deal that provides a savings number for the House and Senate Agriculture Committees so that they may develop legislation to a common budget number.

    Last Congress (112th) there was no agreed upon savings number and the Senate farm bill saved $23 billion while the House farm bill saved approximately $33 billion. A range of this magnitude ensures that there will be significant policy differences for the Committees to address. For this Congress (113th) it is expected that the savings number will be much higher, particularly in the House. Therefore, an agreed upon common budget number would greatly facilitate the farm bill process. With the fiscal situation looming over the farm bill and any of the BIG 3 having the ability to moot or complicate legislative actions taken by the Committees, it is quietly acknowledged by many in agriculture that the best option at this point in time is to make haste slowly.

    SENATE

    • At this moment, the Senate does not have a fully functioning Committee.|
    • With Senator Thad Cochran (R-MS) becoming Ranking Republican member on the Committee replacing Senator Pat Roberts (R-KS), there are many organizational decisions (such as staffing) that will have to be made and implemented before the Committee can focus on moving a bill.
    • Chairwoman Stabenow (D-MI) has stated that the Senate isn’t going to wait on the House and had expressed a desire to move a farm bill quickly, but it is expected that the BIG 3 (along with gun control and/or immigration) will consume the Senate’s immediate time and focus.

     

    HOUSE

    • Chairman Lucas also wants to move a farm bill ASAP. However because of the BIG 3, he must carefully plot the future course of action for the farm bill.
    • Reporters have widely speculated many scenarios for the House. It is expected/hoped that after the Republican Conference retreat this week a consensus will develop on how to address the BIG 3 which may provide an avenue for the farm bill moving forward.
    • Chairman Lucas and Ranking Peterson are still cooperating on farm bill development, notwithstanding Peterson’s comments critical of the House leadership which are intended to increase pressure on the House to pass a bill.

     

    USDA

    • As in the past, USDA is expected to be largely irrelevant in the process. Unfortunately at the moment, comments about the one-year extension and Direct Payments for the 2013 crop year have caused confusion for producers and have not been viewed as helpful on the hill.
    • In any event if large reductions in spending are required and a disproportionate amount comes from nutrition, USDA is expected to actively engage in the farm bill process.

     

    SUMMARY

    • Notwithstanding earlier reports that the farm bill will move in February (which by the way has never been formally scheduled by the House or Senate), there appears to be little action at this time that would support movement that early.
    • Indeed, all eyes are focused on the BIG 3 which may provide a path forward if they are addressed in a coherent fashion. Of course, one must keep in mind coherence has not been an attribute of Congress lately. In addition, the politics surrounding the farm bill may change quickly and in that case the Committees could be in a markup process next week/month.
    • In any event most acknowledge that the likely starting point for the farm bill is close to where the House and Senate left off last year with the realization that the Senate will most likely have to make accommodations in the commodity title for Southern commodities as a result of the new Ranking.

     

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