Gibbs Amendment Would Please Farm Groups

Ohio Soybean Association asks members to write their Representatives urging rapid passage of Farm Bill with adjustment to Price Loss Coverage.

Published on: Jun 17, 2013

The Ohio Soybean Association has joined the American Soybean Association and various farm commodity groups urging their members to reach out to lawmakers to express strong support for timely consideration by the House of H.R. 1947, the Federal Agriculture Reform and Risk Management Act. They are asking members to voice their support of rapid passage of the measure to members of Congress.

The group also expressed its concern regarding the Price Loss Coverage program option included in the Commodities Title of the Committee bill.  The PLC program would set high, fixed reference prices for program crops which, in some cases, exceed their historical prices and cost of production.  It ties payments to producers to crops they grow in the current year, which could distort planting decisions and production if market prices fall below their support levels. 

Gibbs Amendment Would Please Farm Groups
Gibbs Amendment Would Please Farm Groups

Rep. Bob Gibbs, R-Ashland, may offer an amendment to set reference prices at a percentage of recent average market prices, which do not exceed production costs, the group reports.  The Gibbs amendment would also provide for payments on historical crop acreage bases rather than on current-year plantings.  These changes would make the PLC program more market-oriented and significantly reduce the risk of distorting planting decisions and production.  They would also reduce the likelihood of the program violating U.S. commitments under the WTO.  And they would achieve an estimated $10 billion in savings in addition to the Committee bill.

"These changes would make the PLC program more market-oriented and significantly reduce the risk of distorting planting decisions and production," the letter notes. "They would also reduce the likelihood of the program violating U.S. commitments under the WTO. Moreover, they would achieve an estimated $10 billion in savings in addition to the Committee bill."

OSA and ASA support many of the programs included in H.R. 1947. The bill would consolidate conservation programs, reauthorize and fund agricultural research, energy, and export promotion programs, and make improvements in federal crop insurance.  OSA and ASA strongly support these provisions, and ask that lawmakers oppose any amendments which would eliminate or weaken them.

~~~PAGE_BREAK_HERE~~~

The National Corn Growers Association, National Sunflower Association and the U.S. Canola Association also signed the letter urging the House of Representatives to quickly consider and pass H.R. 1947 the "FARRM" Act.

"Our organizations support many of the programs included in H.R. 1947, as reported by the Committee on Agriculture. The bill would consolidate conservation programs, reauthorize and fund agricultural research, energy, and export promotion programs, and make improvements in federal crop insurance. We strongly support these provisions, and ask that you oppose any amendments which would eliminate or weaken them," the letter says.

"We are very encouraged by the momentum that the farm bill has going into the House, and we urge Representatives to act quickly to provide farmers with the certainty we need moving forward," says ASA President Danny Murphy, a soybean grower from Canton, Miss. "We are convinced that lawmakers can work together to pass a bill that both supports agriculture and confronts our budgetary obligations responsibly."

"We were pleased to see the 2013 farm bill pass with such strong support in the Senate and urge the House to swiftly follow suit," NCGA President Pam Johnson, a corn farmer from Floyd, Iowa says. "Passing a comprehensive, market oriented farm bill is critically important to not only agriculture but to every American. We encourage the House to adopt policy that will be both responsive to taxpayers and effective in helping farms remain viable and productive."

"There has been a lot of time, effort, and investment put into establishing an infrastructure for alternative crops such as canola and sunflowers, and we are very concerned that tying reference prices to current year plantings could negate years of work," adds US Canola Association Vice-President Jeff Scott, a farmer from Pond Creek, Okla.

"When and if prices collapse, farmers will choose the crop with the least risk and highest support price. Bottom line, we would prefer to have the markets dictate what gets planted rather than a government support price," says National Sunflower Association President Kevin Capistran, a farmer from Crookston, Minn. 

 "Since the 1996 Farm Bill … farm policy has provided planting flexibility, encouraging producers to respond to market signals in making their planting decisions rather than to the prospect of receiving government payments," wrote the groups. "We do not want to see policies return to the era of high supports tied to current-year plantings, which distorted crop production in the 1980's. The PLC program in the Committee bill should be modified to make it responsive to the market rather than the government."