Livestock producers and cotton farmers will receive some help thanks to a late night session in Washington last week. The news is very good for Texas livestock producers who suffered heavy losses to hurricane and wildfire disasters in 2017.
After a late night Spending Bill discussion, Senate leaders approved a two-year budget deal that, among other things, removes a $125,000-per-producer payment cap on disaster assistance for loss of livestock in the livestock indemnity program (LIP). The bill also retroactively removes the cap to include qualifying disaster losses during all of 2017.
The spending bill was signed by President Trump Friday, which clears the way for additional funds to Texas livestock operators who suffered losses in federally-declared emergency disaster areas, including farmers and ranchers across eight Panhandle counties who lost livestock to wildfires, and farmers in forty counties in south and southeast Texas who suffered livestock losses due to Hurricane Harvey.
Qualifying producers will benefit because after the March wildfires that ravaged parts of the Panhandle, federal officials discovered that the payment limitations of the livestock indemnity program covered only only 70 cow calf pairs. Producers who lost livestock to the wildfires and in Hurricane Harvey will now receive coverage above the former cap, meaning additional aid could soon be on the way.
In addition to removing payment limits in the LIP, the new legislation also expanded some coverage to livestock that were not destroyed immediately but lost in the following weeks of those disasters, provided those deaths were directly related to disaster conditions.
The removal of the annual payment cap also affects Emergency Assistance for Honey Bees and Farm-Raised Fish Program and those who suffered disaster losses in those operations.
Farm Service Agency officials contacted on Friday say no immediate numbers of cattle losses that were previously exempt from coverage because of payment caps would qualify under terms of the new legislation, but a Texas Department of Agriculture spokesman said that number could be significant because in some cases, producers lost entire herds to last year's disasters.
Cotton safety net
Relief for livestock producers who suffered losses to disasters are not the only ones to benefit from the new spending bill. The government will continue to operate until Mar. 23, though technically a shutdown would have been required if the President failed to sign the bill early Friday. The Stopgap measure provides funding for non-essential government functions while allowing time for a new omnibus bill for 2018 that is to include an additional $80 in defense spending and an additional $63 million for non-defense programs.
In addition, the new spending bill makes seed cotton eligible for commodity support programs through the farm bill, a major win for America's cotton growers who have been producing higher cotton quality and yields in recent years, but who are breaking even at best, or suffering losses as a result of low prices and global competition.
Dairy farmers emerged as winners as well. A $20 million cap on the livestock gross margin program has been removed and changes were made to the margin protection program, which is expected to improve coverage. Officials at the National Milk Producers Federation said the changes to these programs will benefit risk management of the industry moving forward.
Yet another provision of the spending bill was designed to bring relief to investors and operators of the biodiesel industry. Congress retroactively revived the $1-per-gallon tax incentive program for biodiesel to the beginning of 2017. However, the legislation does not authorize extending the tax incentive to 2018 as a number of lawmakers expressed concern about program costs.
Finally, the new legislation doubles the acreage eligible for Tree Assistance, an issue important to Sen. Debbie Stabenow (D-Mich.), a ranking member of the Senate Ag Committee.
USDA reports more information about payments provided for in these changes will be worked out and further instructions will soon be released to producers on procedures required to make additional claims for disaster losses.