‘National security issue’: What Congress wants to give farmers for coronavirus downturn
Don’t let bought-out grocery shelves fool you — farmers are having a lot of trouble because of the novel coronavirus.
They’re seriously hurting if their main income came from selling products to schools, restaurants, amusement parks, sports arenas or any other enterprise that shut down to slow the spread of the virus. Dairy farmers, for instance, have seen a 30 to 40 percent decrease in the prices they receive as huge buyers of milk and milk products shut their doors.
Farmers are “price takers, not price makers,” as Rep. Jim Costa, D-Fresno, a longtime almond farmer, put it.
But farmers have been mostly left out of the economic stimulus packages President Donald Trump has signed so far.
House Speaker Nancy Pelosi, D-San Francisco, says farmers are going to be a priority in the next bill Congress passes. But it’s still unclear exactly what that aid will look like, and farmers say they need the money sooner rather than later.
The alternative, Costa said, would be farms going out of business and a diminished food supply chain.
“Food is a national security issue. Unfortunately, the majority of Americans don’t think it is, because you go to a grocery store and there’s all the food you want,” Costa said. “But it’s not until you see those grocery shelves with some of your favorite foods empty. Then it dawns on you that food doesn’t come from the grocery store. It comes from a farmer, a dairy person, a rancher out in California.”
Loans to farmers
The main thing farmers say they need right now is loans. Their prices have taken a hit but they don’t want to lay off employees who they need for their typical farm operations. Many are operating at losses, and it’s unclear how long that can last.
“With the consumers at home, the demand for milk products has dropped dramatically, which causes our prices to drop 30 to 40 percent in the past month,” said Cornell Kasbergen, a dairyman in Tulare. “It’s an economic disaster at the farm level. We’re not really sure how we’re going to survive this.”
The Small Business Administration, which is administering loans passed by Congress in the main $2.2 trillion coronavirus relief bill, excluded farmers from certain programs.
Nick Biscay, the president and CEO of Stanislaus Farm Supply, said no farmer he knows has been able to get loans from local banks. Many of those farmers have told him they’re unable to pay bills they owe him.
“I had a board meeting with farmers this week, every single one of them have said their banks were not set up for the SBA program,” Biscay said.
Pelosi has said she wants a bill that includes aid specific to farmers and she wants Congress to vote on it by the end of the month. But it’s still unclear exactly what that aid will look like or how much money it will include.
She said Treasury Secretary Steven Mnuchin asked for an addition $250 billion to be made available for business loans last week. Pelosi in a CNBC interview on Thursday said Democrats want a bigger package for small business loans, and they want to designate a portion of it banks that serve rural communities, veterans and women.
Farmers, interest groups and lawmakers representing agricultural areas say it won’t be enough. And some members of Congress are getting frustrated that aid for farmers is getting held up by partisan politics.
“It’s crystal clear our farmers need more help. For some unknown reason the SBA decided to exclude our farmers from the relief package we passed and now we’re having to fight tooth and nail just to get them included,” said Rep. Josh Harder, D-Turlock. “To make it worse, Congress is busy dilly dallying and lobbying for their pet projects when what we really need is more relief and a streamlined process to get it, now.”
Food banks
A letter from the National Milk Producers Federation and the International Dairy Foods Association laid out a plan to save the dairy industry, saying Congress needed to “use as many tools as possible – as quickly as possible – to bridge the supply/demand gap.”
One idea in that letter is to increase demand for products by giving more government money to food banks and allowing more people to use food benefits from the U.S. Department of Agriculture, usually known as food stamps, for more dairy products.
More Americans are turning to food banks and government assistance as unemployment becomes more widespread, and producers think it’s a logical place to shift demand temporarily. Food banks would also need additional funding to obtain the necessary cold storage for dairy products.
Lawmakers like Reps. Costa, Harder and TJ Cox, D-Fresno, are also advocating for more payments made to specialty crop producers, such as fruits, vegetables and tree nuts. Many of those farmers have already been getting government payments due to the trade war with China, to offset the costs of Chinese tariffs on their products.
Some lawmakers say those payments now need to be increased further to cover the coronavirus crisis. The aid package passed two weeks ago included $9.5 billion for agricultural producers, including specialty crops, but the USDA still needs to implement any further payment program. And it still won’t be enough, Costa and others are saying.
“The money we’ve done is insufficient to deal with the totality of American agriculture, given the uncertainty farmers are facing,” Costa said.
This story was originally published April 13, 2020 at 5:00 AM with the headline "‘National security issue’: What Congress wants to give farmers for coronavirus downturn."
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