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January 19, 2001

AFBF delegates focus
on farm bill and ag economy

Delegates to the American Farm Bureau Federation's 82nd annual meeting focused on policy to set federal farm program goals to improve net farm income and enhance economic opportunities for America's farm and ranch families.

It was a meeting in which the Texas delegation played a large role, not only in setting farm program policy, but in other areas as well (see sidebar).

"Texas has something to be proud of," said TFB President Donald Patman. "We've worked hard and put some of the issues important to Texas farmers and ranchers through the voting delegate body."

Much of the business session focus was on farm policy, an important issue across the U.S., according to Patman.

"The agricultural program, ag policy as we know it, will probably be rewritten," he said. "It has to be after 2002 and Congress will probably do quite a bit of work on it this year."

Concerning farm policy, delegates said "the next farm bill should focus on a consistent, long-term market-oriented policy." They reaffirmed opposition to mandatory government supply and acreage reduction programs. They said new farm policy should rely less on government, allow farmers to take "maximum advantage of market opportunities," encourage production decisions based on market demand and develop new risk management tools to address income and revenue fluctuations.

In action supported and argued by the Texas delegation, policy was adopted that said the marketing loan program should be continued, with rates adjusted to be in historical realignment with the soybean loan rate.

"Our delegates voted at our state convention to raise the loan rate, and that we have a voluntary set aside," Patman said. "Working with the AFBF and the Resolutions Committee, I felt that the volunteer set aside idea wasn't going to get through. We worked out a compromise with other states. They call it `rebalancing'. Soybeans under the current loan rate are higher than any other commodities. So what we hope to do is adjust the loan rates for rice, feedgrains, wheat and cotton to be equivalent to the soybean loan rate."

Adjusting the loan rates should mean higher LDP payments. "We need to do everything we can for producers' financial well-being," Patman continued. "A lot of people in Texas and other states are up against the wall financially, because of low prices and bad weather."

Delegates specifically said the new farm bill should:

•Allow farmers to lock in a published loan deficiency payment (LDP) rate after planting.

•Expand the funding baseline for all agriculture programs.

•Provide maximum planting flexibility without negatively affecting non-program crops or livestock production.

•Continue voluntary, direct-payment programs that comply with World Trade Organization limits.

•Include a "countercyclical income assistance safety net."

Delegates also said "market loss assistance payments for all commodities and livestock "should be continued until trade-negotiating authority becomes law and agricultural trade is improved." They also said the Agriculture Secretary should have "discretionary authority to provide assistance to producers in times of economic disasters."

They supported changes in the LDP program to make all producers of program crops eligible for payment, regardless of whether a farmer has a contract for regular farm program (AMTA) payments, and extend formal LDP dates to coincide with the Agriculture Department's marketing year.

Also, when producers have crop insurance, delegates said they should receive LDPs on "actual production or established yield, whichever is greater."

They said producers of all crops should have access to risk management tools that accurately reflect individual risk, and revenue insurance tools should be expanded to include a program for livestock producers. The delegates said that crop years affected by natural disasters should not hurt a farm's production history for crop insurance.

Delegates reaffirmed their commitment to a market-oriented dairy program and adopted policy language calling for expansion and reauthorization of the Northeast Interstate Dairy Compact, and authorization of the proposed Southern States Dairy Compact.

Aggressively reaffirming the organization's opposition to federal estate taxes, the delegates left no room for misinterpretation, saying farmers and ranchers would settle for nothing short of an all-out repeal of the death tax.

Overall, they said government agricultural policies should: ensure enhanced funding for research; reduce regulatory burdens; provide a fair and equitable tax structure; ensure consumer access to safe and nutritious food; and continue to improve the environment through voluntary initiatives.

Delegates expressed deep concern regarding mergers and concentration in agribusiness, saying that federal oversight should ensure that proposed agribusiness mergers and vertical integration arrangements do not hamper independent producers' access to inputs and markets.

The Agriculture Department's authority on mergers should be expanded, delegates said, including the ability to challenge proposed mergers if the Justice Department fails to investigate.

Delegates said they would ask the Justice Department to look at market competition and price discovery whenever an agribusiness controls 25 percent or greater share of its market sector.

Delegates reaffirmed support for programs to open new export markets and assure continued access and a competitive position in existing markets.

They also made it clear that using food as a weapon will not be tolerated, urging the government to "lift all trade sanctions on all countries that purchase U.S. farm commodities." Delegates supported principles of the WTO and stated they would urge the administration to eliminate export subsidies and trade barriers and ensure adherence to fair trade rules by competing nations.

The delegates elected Washington State Farm Bureau President Steve Appel of Dusty, Wash., a wheat and barley grower, to serve as the organization's vice president for one year, to complete the term of retiring AFBF Vice President Jack Laurie of Michigan.