The top Democrat on the Senate Agriculture Committee wants to know why southern producers have received higher payment rates than others through the Market Facilitation Program. Senator Debbie Stabenow of Michigan questioned the methods behind calculating the payments Thursday during a hearing on the 2018 farm bill.
“I don’t see how the payments are lining up with the damage. Ninety five percent of the counties with a top rate, a payment rate of $100 or more or in the South. Seventy seven percent of the counties that have minimum payments of $15 are in the North and West. I’m not trying to start a new war between the North and the South, but we work really hard to make sure that the Midwest and the North are viewed equally. And so, we are seeing the payment rates clearly going to southern counties and commodities, despite the fact that the North and Midwest have been hit the hardest. And, I’ll give an example; cotton received significant payments last year, in 2018, even though cotton prices increased.”
Deputy Agriculture Secretary Stephen Censky explained it comes down to production in a county and what specific commodities are worth.
“Our chief economist used the modeling to take a look at the actual retaliation that is taken and how that is effecting our exports of the various commodities. And that has been done on a consistent basis without any kind of consideration of north, south, east, west, or anything like that. And, in terms of the retaliation and the differences in-between counties, we worked hard to try to make sure that we were using a consistent approach, and generally, to the degree to which a county had more of a crop that had a higher impact, and that higher proportion of the crops being grown in that county were a highly impacted crop, that means that that payment rate would be higher.”
Censky offered to work with Stabenow in explaining the methodology.