Farm bill

gets mixed

reaction

Packer ban dumped

By FRITZ BUSCH

Journal Staff Writer

WASHINGTON, D.C. -- The new Farm Bill agreed upon by Senate and House negotiators drew a mixed reaction from politicians and political action groups from Minnesota and across the country.

The $170 billion legislation will boost total agricultural spending by $73.5 billion over 10 years for commodities, conservation, trade, nutrition, credit, rural development, research, forestry and miscellaneous items including country of origin labeling, family farmer bankruptcy protection, swine production contracts and disclosure.

Livestock and poultry producers could discuss contracts with state and federal agencies and other individuals having a fiduciary or familial relationship.

The House will take up the bill soon, with the Senate to follow. If approved, the bill will go to the president for signature.

Sen. Mark Dayton, D-Minn., said the new bill is an improvement on current law with more support for rural communities, a new national price support program for dairy farmers, a new conservation program to encourage sound environmental practices, and a requirement that meat, fish and produce be labeled with their country of origin.

The bill's loan rates are $1.98 per bushel of corn, $5 soybeans and $2.80 wheat. Dayton proposed $2.40 corn, $5.36 soybeans and $3.88 wheat.

A Dayton-authored amendment in the bill provides $5 million in mandatory spending between fiscal years 2003 and 2007 to educate the public on the benefits of using bio diesel fuel.

The Senate originally approved $20 million for the program, aimed at helping reduce U.S. reliance on foreign oil while increasing farm product demand and environmental benefits.

The bill lacked Senate-approved measures like stricter payment limitations to target benefits towards small and medium-sized farms, higher loan rates to protect farmers against severe price fluctuations and save taxpayers billions of dollars in emergency payments to farmers, disaster assistance and a provision to level the playing field between family ranchers and large meat-packing corporations.

Dayton said plenty of people in Washington didn't want to see farmers get a higher price in the marketplace, they'd rather see taxpayers subsidize them.

"The (Washington D.C.) forces that want to keep prices low are very powerful," Dayton said.

After lots of negotiation, a provision was approved, allowing producers to receive up to 50 percent of their payments by Dec. 1 of the year prior to planting, which will help cash flow, Dayton said.

Loopholes allowing corporate farms to receive payments for each entity, will mean fewer farmers getting money, Dayton said.

Sen. Paul Wellstone, D-Minn., liked most of the bill.

"It's not heaven on earth, but it's real good for Minnesota," Wellstone said. "I'm delighted the "freedom-to-fail bill" (previous farm bill) has been put to rest. The target prices aren't up as much as I'd like, but no secretary of agriculture can lower the loan rate. For dairy farmers, it's the best thing they've received in a long time."

The average dairy farmer will get an additional $12,000 per year, Wellstone said.

Disappointed that the ban on packer ownership of livestock was not in the bill, Wellstone said he will fight for that measure in the owner-appropriations, anti-trust or co-appropriations bill.

Water and wastewater treatment programs will allow the government to deal with a backlog of small communities needing improvements. Other funding will be used to more firefighting and emergency personnel training, Minnesota Congressman Mark Kennedy said.

Meanwhile, the Center for Rural Affairs of Walthill, Neb., said the nation's biggest farms will receive an even larger share of farm program payments than in recent years with no limit on marketing loan gains.

Income support payment limits would be raised to $210,000, up from $160,000 under recent emergency legislation, the group said.

It called the bill's $150,000 cap on marketing loan gains "meaningless" because it can be avoided by a generic certificate loophole. Large farms that reach the payment limitation could fill out another form and get loan deficiency payments as generic certificates -- which do not count toward the payment limitation.

The limit on counter cyclical payments would affect only the largest fraction of one percent of farms, CRA said.

For two brothers farming with their parents, a corn-and-soybean farm would need to reach nearly 20,000 acres and a wheat-and-sunflower operation nearly 50,000 acres to be affected by counter cyclical payment limits, according to the group.

The Land Stewardship Project denounced the bill, saying subsidies will produce an oversupply of cheap grain and funnel $46 billion in new spending to commodity program payments, aiding the largest farms the most.

The payments contribute to an overproduction of a few crops, leading to excessive soil erosion and other environmental degradation.