As Congress continues to debate potential solutions to the fiscal cliff issue, the American Soybean Association (ASA) reached out today to leaders of the House and Senate Agriculture Committees to provide its views on potential provisions in a comprehensive five-year farm bill.
In a letter from ASA President Danny Murphy, ASA restated its support for many of the provisions included in both the House and Senate versions of the farm bill, and expressed specific support for the Senate’s Agricultural Risk Coverage (ARC) program, which will provide important protection against reductions in both price and yield. ASA also pointed out major drawbacks to the Price Loss Coverage (PLC) option included in the House bill identified in a recent analysis by AgRisk Management, LLC.
The PLC program “establishes much higher and disproportionate reference or target prices that bear little relation to recent average market prices or production costs,” stated ASA. “Moreover, by tying payments to crops that are actually grown in the current year, the PLC option has the potential to significantly distort planting decisions, production, commodity prices, and government program costs in the event market prices fall. ASA noted that, according to the analysis, “soybean farmers would receive less protection than producers of other crops, and the soybean share of crop production in almost all regions would be adversely affected.”
ASA’s letter concluded that “if this option is included in the final farm bill, payments must be decoupled from current-year production and tied to historical crop acreages.”
A transcript of the letter is available by clicking here.
ASA remains committed to a farm bill that protects planting flexibility, and protects and strengthens the current federal crop insurance program. ASA also strongly supports streamlining and eliminating duplication of conservation programs, authorization of the MAP and FMD export promotion programs, and renewal of research, biofuels, and biobased product program authorities.