U.S. Treasury Secretary Scott Bessent said last week details of potential new federal support for farmers could be released as soon as Oct. 7. But that announcement is unlikely to happen.
“The Trump administration has pushed back its plans to roll out economic aid for farmers this week due to the government shutdown,” said an article published Tuesday afternoon by Politico.
The article said the “Office of Management and Budget has readied between $12 billion and $13 billion to be allocated from an internal USDA account,” but no final decision has been made on how much or when the money would go to farm aid.
“If this is a temporary shutdown, you know, if we’re talking another week or two, it’s probably not going to affect too much more in that length of time,” CPA Paul Neiffer ventured during a conversation with Chip Flory, host of AgriTalk.
Still, Neiffer noted farmers are being impacted by delayed and/or canceled payments. He cited ARC and PLC payments farmers have anticipated for the 2024 crop. The funds were supposed to be distributed on Oct. 1 but got postponed.
“That certainly doesn’t help farmers from a cash flow standpoint,” he said. Get the complete discussion on AgriTalk:
Neiffer added that farmers also need to know there is another type of cost to ARC and PLC payments — they are subject to the 5.7% sequestration adjustment.
“If farmers were counting on, let’s say $50 an acre, maybe they’re going to get $47 an acre. So that is something that’s going to affect them,” he said.
As for when the government shutdown might end, Neiffer referenced Washington Policy Analyst Jim Wiesemeyer, who reported the closure might conclude by Friday, Oct. 17.
“Of course, we are dealing with Congress, so let’s don’t use logic,” Neiffer said. “If they can come to a deal on the extension of the Obamacare premium subsidies, I think that’s fairly easy. If the Democrats are going to dig in on Medicaid and some of that other stuff, then, yeah, this could go on quite a while.”
Various Programs And Reports Are Suspended
It’s estimated about 42,000 USDA workers are being furloughed during the shutdown.
“Local FSA offices have mostly closed. It’s about 67% of USDA staff who work in those offices and deal with all the different programs that FSA administers,” Callie Eideberg, policy expert with the Vogel Group, told AgDay TV’s Clinton Griffiths.
“Folks…are waiting for this government to reopen so farmers can continue to engage with these programs and get the money that they so desperately need,” Eideberg said.
Neiffer cited the Environmental Quality Incentives Program (EQIP) and the second stage of the Supplemental Disaster Relief Program (SDRP) as two of the numerous financial programs on hold.
Also in jeopardy of being delayed or cancelled is the October WASDE, scheduled for release this Thursday.
Payment Wheels Likely To Turn Slowly
Even if the financial aid package is announced this week, Neiffer said farmers are unlikely to see any money until December at the earliest, and January 2025 is more likely.
“I think what we have to remember when the ECAP program (Economic Assistance Payment)
was announced in December, it had 90 days to get done, and they took the full 90 days to get it done,” he said.
During their conversation, Flory asked Neiffer whether the timing is right for the aid package.
“I’m starting to get a little concerned,” Neiffer acknowledged. “You know, there are other industries out there that are likely to soon say, ‘Hey, what about us?’”
Another concern Neiffer voiced was whether an aid package is artificially keeping cash rent prices at higher levels.
“You talk to landlords and they could say, ‘Hey, these farmers are getting an extra $50 or $100 per acre. I want a third of that or 40% of it, because I’m the cash rent landlord.’ So, yeah, I do have a concern. The aid is needed, but at what point do we get the law of diminishing returns, and it’s too much? We might be approaching that.”
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