Market Facilitation Program details released
Wednesday, September 18, 2019
Posted by: Aaron Stauffacher, assoc. director of gov. affairs
In late July, the U.S. Department of Agriculture (USDA) released details of the $16 billion trade aid package announced in May. USDA is spreading the funds over three different programs with $14.5 billion in direct payments to farmers through the Market Facilitation Program (MFP).
Beginning on Monday, July 29 farmers were able to sign up for the first direct payment from MFP. Subsequent payments may be scheduled for November and January if the USDA determines they are necessary based on market conditions. Farmers are encouraged to sign up as soon as possible, if they have not already done so. Signup ends December 6, 2019.
Dairy payment rates are set at $0.20 per cwt and based on a farm’s historical production for the Dairy Margin Coverage (DMC) program.
A farm’s DMC milk production is calculated using the highest annual production during the 2011, 2012 and 2013 calendar years. Farmers who have not participated in DMC can still sign up. If a farmer was not farming during those three years, the payment will be calculated in the same way it would be if the farmer was newly signing up for DMC. Dairy farms must have been in operation on June 1, 2019, to participate. (first payment = $0.20 x 50 percent of total milk production).
Dairy farmers will also be eligible for other commodity payments. Please note USDA has expanded the list to include alfalfa hay, barley, canola, corn, millet, oats, rapeseed, rye, sorghum, soybeans, triticale, and wheat, among others. Unlike the previous payments, crop farmers will receive per-acre payments regardless of commodity. The payment will be based on a single county multiplied by a farm’s total plantings of eligible crops in total in 2019. Individual county rates range from $15 to $150 per acre and can be found at farmers.gov/manage/mfp along will all other program information.
The first payment for dairy and all other crops will be either 50 percent of a farmer’s payment or $15 per acre, whichever is higher. USDA is planning to make the first set of payments in mid-to-late August.
Farmers who filed prevented planting claims but then planted with FSA-certified cover crops planted prior to August 1 qualify for a $15/acre payment.
The direct payments are limited to $250,000 per person or legal entity for dairy farms and $250,000 for non-specialty crops farms per person or legal entity. No applicant can receive more than $500,000 in total MFP payments.
To be eligible, farmers must:
- Have an average adjusted gross income of less than $900,000 for tax years 2014, 2015 and 2016; OR derive at least 75 percent of their adjusted gross income from farming.
- Comply with highly erodible land and wetland conservation requirements.
- Have a farm number with USDA’s Farm Service Agency.
Applications (Form CCC-913) can be found and downloaded at the website referenced earlier. Once the two-page application is completed with milk production history and eligible planted acres, it should be delivered or sent via email, mail or fax to your county FSA office.
The second part of the aid package is the Food Purchase and Distribution Program though which $1.4 billion will be spent to purchase surplus food products and distribute them to food banks, schools and other outlets serving low-income individuals. Dairy food purchases will make up $68 million of the total.
For the third leg of the package, earlier this month USDA awarded the $100 million trade promotion program to 48 qualifying organizations. This program will help build long-term trading relationships and open market access for dairy products. Eligible activities that funds can be used for include consumer advertising, public relations, point-of-sale demonstrations, trade fairs and exhibits, market research, and technical assistance.