The 2023 Farm Bill comes at a time when farmers are facing inflated input costs, supply bottlenecks and shortages, and an increasing number of severe weather events. The historic trend of zero-base budgeting in past Farm Bills suggests that the allocation of funds will be no small task as lawmakers sift through competing priorities.
AgAmerica’s economists, Dr. John Penson and Dr. Cliff Shelton, have been monitoring congressional hearings and legislative developments related to the 2023 Farm Bill and are consolidating these insights into a two-part analysis. In this first part, they discuss the key issues breeding the most contention in the Farm Bill debate and provide policy considerations for each major Farm Bill title—Commodities, Conservation, Crop Insurance, and Nutrition—which account for 99 percent of total Farm Bill funding.
Keep reading to learn more about the challenges and potential solutions surrounding five key topics that Farm Bill discussions have centered around thus far.
INTERACTIVE DEEP DIVE
THE 2023 FARM BILL: FIVE TOPICS TO WATCH
Topic #1
Commodity Program Reference Prices
The Challenge:Many agree that the reference prices for major commodities to trigger payments are outdated. For example, the reference price for corn is $3.70 per bushel in the PLC program. While the current price is more than double that, production costs—including fertilizer and fuel—have more than doubled. If commodity prices fall, as they inevitably do, this will further constrict profit margins.
Potential Solutions: Some suggest the reference price should be based on a breakeven or margin basis rather than gross revenue, like the Dairy Margin Coverage (DMC) program. For example, dairy farmers can enroll in the DMC program to supplement the difference between the national milk price and the average cost of feed if it falls below the coverage level.
Topic #2
Climate-Smart and Conservation
The Challenge: High market prices are discouraging Conservation Reserve Program (CRP) enrollment, while skyrocketing food prices and supply chain disruptions are distracting focus from climate-smart initiatives.
Potential Solutions: Focus on programs that restore rather than retire, increase cost-sharing programs to help farmers cover upfront costs of transition, and expand technical assistance to implement practices correctly.
Topic #3
Research and Technical Assistance
The Challenge: Many in the industry believe that ag research is woefully underfunded in areas including biological advancements, mechanization to address labor shortages, food security and safety, climate change, and more.
Potential Solutions: In addition to funding for research initiatives, this title must also focus on providing training and support to implement research at the farm level to increase rates of success.
Topic #4
Rural Infrastructure Development
The Challenge:Rural access to high-speed broadband is crucial to farmers and ranchers, given today’s ever-evolving technology. However, Wi-Fi connectivity in rural areas remains an issue, limiting efficiency and automation as well as contributing to critical gaps in rural health care.
Potential Solutions: The $1.2 trillion infrastructure package approved in 2021 can be used as a funding vehicle to provide substantial funding for rural infrastructure that will make American farmers more competitive in a global market. Farmer input is critical when deciding funding allocation and ensuring it is being used in areas with the greatest need. In addition, some economists suggest farm supply co-ops could also be leveraged to expand private broadband networks.
Topic #5
Food Distribution and Affordability
The Challenge: This topic is heavily divided, with one side requesting a more scrutinized review of the title to potentially make fiscal cuts and the other side wanting improvements and likely expansion of these programs in light of recent inflationary pressure.
Potential Solutions: The Food Systems Transformation Framework is a step in the right direction to address supply chain constraints that are contributing to higher food costs. However, the impacts of processing and storage expansion will take time. Pandemic-related response laws must be reviewed to determine what programs must be extended, modified, or expired to ease food costs.
Click below to find more information about key topics under debate for the 2023 Farm Bill and a summary of policy considerations to ensure continued support of American agriculture.
Stay Informed of Ag Legislative Updates with AgAmerica
Throughout the legislative process, AgAmerica’s economists are diligently following developments for the 2023 Farm Bill to keep you and our team informed. As a champion for a thriving future for our nation’s farmers, AgAmerica is making it our mission to communicate these findings to you and equip agriculture with the resources needed to ensure the voice of agriculture is heard.
As lawmakers move forward to create the 2023 Farm Bill, AgAmerica will be providing deep-dive analyses for each major Farm Bill title and its impact on our nation’s farmers and ranchers. Sign up for AgAmerica’s newsletter to be notified of each new release. Once the 2023 Farm Bill has been finalized, be on the lookout for The 2023 Farm Bill: Part Two whitepaper as we unpack the final product and its direct impact on our nation’s farmers and ranchers.
Download AgAmerica’s whitepaper, The 2023 Farm Bill: Part One, to explore major topics up for debate this year and learn how you can make your voice heard in the conversation.
