Farm Bureau to Feds: Extend 2002 Farm Bill

American Farm Bureau Federation delegates are not averse to a farm bill with diminished farm supports, so long as this is accompanied with provisions aimed at opening up more foreign markets to U.S. farm goods.

Until then, delegates prefer to carry the farm support provisions of the 2002 Farm Bill into the next farm bill. This sentiment was expressed in a formal vote of the delegates at the AFBF's annual meeting in Nashville last month.

Bob Stallman, president of the AFBF, said the safety net provided under the current farm bill is essential until trade negotiations secure lasting guarantees for increased market access.

“Our members continue to say they are willing to negotiate about lower domestic support payments if, in exchange, they can secure increased opportunities to sell their products overseas,” Stallman said.

On the other hand, he said, farmers “aren’t willing to disarm.” Indeed, any overhaul of farm legislation must occur in tandem with a World Trade Organization agreement that reduces tariffs and grants market access. For now, Farm Bureau leaders fear the ongoing Doha Round of the WTO negotiations will not be successfully worked out before passage of the 2007 --- precisely why Farm Bureau delegates insist on guarantees.

Last Year, U.S. Trade Representative Rob Portman offered drastic changes in U.S. farm policy in exchange for more market access. This included a 60-percent reduction in trade-distorting “amber box” subsidies. Blue box subsidies could not exceed 2.5 percent of the total value of production --- or about $5 billion of all commodities.

Farm bill pundits believe that decoupling of farm payments --- an issue that figured prominently in drafting of the 1996 Farm Bill --- could be a central issue in the upcoming farm bill debate. That’s because the more a payment is tied to actual production, the more difficult it will be to defend in ongoing WTO negotiations.

Granted, farm bill forecasting is by no means a precise art, though Carol Skelly, a USDA cotton analyst, recently ventured a guess. A likely outcome, she believes, will be a 2007 farm bill that shifts payments from coupled to decoupled categories --- for example, fewer amber box payments and more green and blue box payments.

Posted by Jim Langcuster at February 6, 2006 04:47 PM | TrackBack