USDA Proposes Drought Aid Package Including $780 Million in Assistance

Ag Department assisting farmers through $50 million Livestock Assistance Grant Program, $30 million in unused conservation funds and advanced countercyclical payments for cotton, sorghum and peanut producers.

Published on: Aug 29, 2006

Secretary of Agriculture Mike Johanns says USDA won't make any final decisions on emergency drought disaster spending until after the combines start to roll, but the agency is trying to give immediate assistance to farmers stricken with drought this year.


Tuesday Johanns outlined $780 million in assistance to farmers and ranchers to help manage drought and weather-related production challenges. This funding includes a new $50 million program for livestock producers impacted by drought, focusing nearly $30 million in unused conservation funds on drought, and accelerating the delivery of an estimated $700 million in countercyclical payments. CCP to upland cotton, grain sorghum and peanut will be expedited to the growers yet this week, the earliest ever given, Johanns adds.


He explains that a record 246 million acres of cropland is enrolled in the federal crop insurance program. USDA expects to dole out $4.6 billion in insurance payments, on top of Tuesday's assistance measures.


Livestock assistance: The new $50 million program for livestock producers, called the Livestock Assistance Grant Program, will provide $50 million in Section 32 to states in block grant form. States will distribute to livestock producers in counties that were designated as D3 or D4 on the Drought Monitor anytime between March 7 and August 31, 2006. The grants will help livestock producers restore their purchasing power. A list of eligibility criteria and eligible counties can be found at by clicking on the drought spotlight.


Conservation funds: The nearly $30 million in unused conservation funds includes almost $19 million in unused Emergency Conservation Program funds and $11 million in unused Grassland Reserve Program. The ECP funds will go to 27 states. Information on eligibility and a list of the states and funding is also posted online. The GRP funds will help to protect drought-affected grazing lands. The funds will be distributed to 14 states. These funds will be focused on pending GRP applications for rental agreements in drought-affected areas.


Johanns also directed the Natural Resources Conservation Service state conservationists to work with their producers and state technical committees to focus remaining FY 2006 and a portion of FY 2007 conservation program funds on resource conservation practices related to drought response and mitigation. Programs such as the Environmental Quality Incentives Program, the Wildlife Habitat Incentives Program, the Agricultural Management Assistance program, and GRP have built-in flexibility and local decision-making ability in order to encourage a focus on state-specific concerns, such as those related to drought.


Countercyclical payments: Johanns directed that 2005-crop year counter-cyclical payments be delivered as quickly as possible to expand the financial resources of farmers facing drought. An estimated $700 million in payments to upland cotton and grain sorghum producers will be made this week. This will constitute the earliest delivery of counter-cyclical payments on record. Payments to peanut producers will also be expedited, following the calculation of the final 2005 average price.