The U.S. Congress is recessed during August and the Iowa Corn Growers Association is asking its members to participate in a "Call to Action" while Congressional members are back home in Iowa this month.
"We are asking farmers to please contact their U.S. Senators during the month of August and urge them to include the National Corn Growers Association farm bill commodity title proposal in the 2007 Farm Bill," says Mindy Poldberg, director of government affairs for ICGA. "The House passed a revenue option and we need to build upon/improve the revenue coverage in the Senate. Time is of the essence. Congress is recessed right now so our representatives are home in Iowa. When they return to Washington in September, the Senate will begin debating a new Farm Bill."
Voting delegates at the corn growers annual policy conference decided last year that the 2007 Farm Bill Commodity Title for corn, and potentially other commodities, should provide for a county revenue countercyclical program integrated with crop insurance that is market sensitive while providing a safety net. This proposal is modeled after the Group Risk Income Protection policy.
Modeled after GRIP crop insurance
It would replace the current target price-triggered counter cyclical program and be based on planted acres, rather than base acres. Producers would receive payments when their actual county revenue (per acre) falls below the county's expected revenue (per acre). Under the Corn Growers' proposal, integration of the county revenue countercyclical program with federal crop insurance will reduce market and area production risk allowing insurance companies to offer higher levels of individual farm level coverage at a lower cost.
This proposal is designed to be more market sensitive – something beneficial for commodity producers and the U.S. taxpayer, says ICGA.
Here's the current issue: The U.S. House of Representatives passed a farm bill in late July that includes an optional national revenue-based countercyclical program commodity title. "While we are pleased that this bill provides for a safety net and moves the process forward, its national revenue-based program would not be as close an index to an individual producer's revenue as our county-based option," says Poldberg.
In the U.S. Senate, Sens. Richard Durbin, D-Ill., & Sherrod Brown, D-Ohio, have introduced a state-based revenue option that is even closer to the NCGA proposal. "Now, while members of congress are home for the August recess, we need to express our continued support for a county-based revenue program for the next commodity title and applaud the Durbin-Brown bill as a step in the right direction," she says.
"We need change in next farm bill"
ICGA wants farmers to tell senators "We need change in the next farm bill." Specifically, here's what they suggest as talking points:
- The tremendous increases in risk farmers are now experiencing requires improved risk management coverage for revenue, not just price.
- Revenue is what pays the bills to keep our farms up and running. Agriculture in the U.S. has changed dramatically since 2002 making our current farm supports outdated.
- Crop input costs are a major factor of profitability
- Unlike today's price triggered support, the NCGA proposal delivers market based revenue protection based on actual planted acres rather than historical base acres – a key advantage, especially with rising input costs.
Revenue Based Protection: It is complimented by individual crop insurance
- Senators Durbin and Brown's bill would replace the current farm supports with a risk management system that builds on the crop insurance reforms of 2000.
- Protection from federal crop insurance, alone, against multiple years of crop losses remains inadequate. So much so that growers in some parts of the country continually call for ad hoc disaster aid that usually arrives too late with too little to make a real difference. Basing yield guarantee on a 25 year historical trend will better reflect true county yield potential than averaging the most recent 10 years actual yield.
- Although the Durbin-Brown proposal for a state revenue trigger is better than a national trigger, a revenue counter cyclical program with a county revenue trigger moves us much closer to more predictable support against area wide production losses as well as downturns in the market. This could replace the need for disaster assistance; it effectively builds on a "permanent disaster aid program."
- If a county (or even a state) based revenue program were in place today, farmers hit hard
by the early spring freeze, drought and floods would receive more effective support.
- Even better, the revenue counter cyclical payments would be integrated with indemnity payments to reduce crop insurance costs – and that means lower premiums for the same or a higher level of revenue protection.
Poldberg is urging farmers to make calls, send emails or attend town meetings during August. She says you can learn of upcoming events and get contact information for Senator Harkin at www.harkin.senate.gov or by phone at 202-224-3254 and Senator Grassley at www.grassley.senate.gov or by phone at 202-224-3744.