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Federal relief efforts | edited June 16


U.S. Department of Agriculture

Agriculture Secretary Sonny Perdue unveiled USDA’s first relief plan in response to the COVID-19 crisis on April 17. The Coronavirus Food Assistance Program (CFAP) includes $16 billion in payments to farmers across many commodities and $3 billion in purchases of products to be redistributed into food aid programs. These funds were allocated by Congress under the CARES Act.

Starting on Tuesday, May 26, USDA opened up the period for farmers to sign-up for direct financial assistance. Sign-up must be done through a local Farm Service Agency office. Dairy farmers are eligible for price losses on their milk production, livestock sales and non-specialty crops, like corn, stored as feed.

As of June 15, the CFAP program has processed close to $2.9 billion in payments to a total of 220,280 producers across the country. Dairy payments made up close to $667 million in payments through 12,000 applications so far. The detailed report is available here.

Assistance for dairy:

  • Eligibility: To be eligible, dairy farms must have milk production in January, February, and/or March 2020. Milk disposed of during those months is also eligible for assistance. Milk covered under other risk management tools such as forward contracts, dairy margin coverage, dairy revenue protection and livestock gross margin will qualify for assistance.
  • Calculations: Financial assistance will be based a farmer’s certification of milk production for the first quarter of calendar year 2020. A single payment of about $6.20 per hundredweight will be made comprised of the following two calculations:
    • First quarter milk production multiplied by $4.71 per hundredweight.
    • First quarter milk production times a national adjustment factor of 1.014 and multiplied by $1.47 per hundredweight.

Crops stored as feed: Stored hay or silage is eligible for assistance under the non-specialty crop section of the farmer payments if the commodity is a covered commodity. Notable commodities include corn, oats, wheat, barley, grain sorghum and soybeans. High moisture corn is also eligible. Common forages like alfalfa and grasses are not eligible. Farmers will need to certify their 2019 total production and inventory on hand on January 15. 2020. As the unit of measure for different commodities are in bushels, farms will need to covert the amount of stored feed on hand to determine the number bushels eligible for payment. Local FSA offices will assist with conversions. Farms should document how the number of tons were calculated should they be audited at a later date.

Assistance for livestock: Dairy farmers may also claim assistance when they sell animals. Cull cattle sold in the eligible period will be treated as Slaughter Cattle: Mature Cattle and counted on a per head basis. Dairy calves sold will fall under one of two Feeder Cattle categories depending on if the animal was above or below 600 lbs. Heifers sold intended for milk production will not be eligible for an additional livestock payment.

For additional details regarding these three payment categories, visit these Supplemental instructions assembled by Edge Dairy Farmer Cooperative and Dairy Business Association.

Initial payments will be prorated, with 80 percent paid initially and the remainder at a later date if funds remain available to help the agency ensure all farms receive access to assistance.

Payments will be limited to $250,000 per person or legal entity. The cap applies to the total amount of payments with respect to all eligible commodities. If a legal entity has more than one member/partner, the entity may qualify for up to three times the $250,000 payment cap. Adjusted gross income limitations also apply.

More information including the application form, supporting documentation, and a new payment calculator are available on the USDA webpage, farmers.gov/cfap. If a farm is already an existing FSA customer, most of the information is likely already on file at the local service center. FSA offices will only take phone appointments at this time, so do not send information without first contacting the office.

For food product purchase portion of CFAP, USDA launched the Farmers to Families Food Box program. On May 8, USDA awarded $1.2 billion in contracts to processors and producers to supply food aid channels. Dairy products accounted for $317 million of those purchases. USDA started making product purchases to meet the demands of the growing number of those enrolling in food assistance programs and using food aid distribution centers. Secretary Perdue emphasized that USDA has emphasized that purchases have been targeted toward products that have been significantly impacted by the closure of food service markets. These products are provided to food banks, community- and faith-based organizations and other non-profits.

USDA’s response largely reflects Edge’s requests. In mid-April, Edge sent USDA a letter to highlight our requests and to stress the urgency of providing that relief soon along with a letter sent earlier in April with other groups advocating for dairy product purchases and direct financial relief.


Additional resources

State health services:

 State Department of Agriculture

 


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Crisis or not, DBA and Edge is focused on supporting our members now and always. Please let us know if you have questions about COVID-19 or anything else. Click here for the DBA or Edge staff list.

 


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