USDA recently announced another round of Market Facilitation Program (MFP) payments for 2019 to assist farmers harmed by retaliatory tariffs imposed by China. The program will be administered by the Farm Service Agency (FSA) and provide up to $14.5 billion in direct payments to farmers who grow commodities affected by the trade war, including soybeans.
While some information about the program has been announced, many details remain unknown.
The Ohio Soybean Aassociation recommends farmers utilize USDA’s available resources to stay up-to-date as the program develops and more details are announced. Additional information, documents, and a complete list of included commodities can be found here.
What We Know
- Payments will be based on a single county rate multiplied by a farm’s total plantings to specific crops in aggregate in 2019.
- County payment rates will be based on USDA’s assessment of the impact of tariffs on individual counties.
- Per acre payments are not dependent on which of the included crops are planted in 2019, so as not to distort planting decisions. Total payment-eligible plantings cannot exceed total 2018 plantings.
- Different than the 2018 MFP, payments for 2019 will be made in three tranches, with the second and third tranches evaluated as market conditions and trade opportunities dictate. The first tranche will begin in late July or early August as soon as practical after FSA crop reporting is completed by July 15th. The second and third tranches could occur in November and early January if USDA decides they are warranted.
What We Don’t Know
- How will USDA calculate county payment rates and what will those rates be?
- What percentage of the overall payment pool will be distributed in the first payment tranche this summer?
- If a farmer can’t get acreage planted and files for prevented planting coverage on crop insurance, will that farmer qualify for any payment under the 2019 MFP? USDA Secretary Sonny Perdue has indicated this is being evaluated.
- Would the same farmer be eligible for disaster aid assistance if the disaster relief package currently being considered by Congress is passed?
In addition to direct payments, USDA will be implementing a $1.4 billion Food Purchase and Distribution Program through the Agricultural Marketing Service to purchase surplus commodities affected by trade retaliation. Also under MFP 2019, $100 million will be issued through the Agricultural Trade Promotion Program to assist in develop new export markets on behalf of producers.