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Grain processors, exporters favor overhaul of CRP
Citing a need to capture growth opportunities and sustain growing demand for grains and oilseeds from the ethanol, livestock and poultry sectors, an alliance of four grain processing and exporting groups is encouraging USDA to make substantial changes in the future direction of the Conservation Reserve Program (CRP). They are urging USDA to consider allowing a "large number" of current contracts to expire and to view Congressional authorization to increase the size of the CRP to 39.2 million acres as a ceiling, not as a mandate.
In particular, they say they think USDA should not simply re-enroll the 16.1 million acres with contracts set to expire in 2007 and the 6.1 million acres that will expire in 2008, but rather focus on those that provide the most significant environmental benefits, particularly to water quality.
Their thoughts were presented in a joint statement submitted in response to USDA’s request for comments on long-term CRP policy.
The groups argue that continued CRP expansion will hamper US agriculture's ability to produce and compete in global markets, and say the size of the CRP already has adversely affected the availability of land to build and grow an economic foundation for the grain, livestock, milling and processing sectors of the US economy.
Further, the organizations say the CRP has had a damaging economic impact on local economies, particularly in the plains states.
Below are some of the groups' arguments:
* USDA should refocus CRP on soil and water-quality improvements, and away from whole-farm enrollments and emphasis on wildlife habitat. The organizations say the environmental benefits index (EBI) used by USDA to evaluate CRP bids should be modified because it currently gives equal weight to soil erosion, water quality and wildlife benefits. They called eequating wildlife benefits to the issues of soil erosion or water quality "irresponsible and not a good use of scarce economic resources."
"A common argument used to d efend the CRP is that it is creating a niche industry catering to hunters and fishermen," the organizations said. "Our members certainly are involved in and support these activities. But should those activities be subsidized through government payments?"
* Idled acres should focus on filter strips, buffers and the most environmentally sensitive lands, with a strong emphasis on substantially improving water quality. Conservation practices should be targeted to working farmland and assist farms to implement soil conservation practices.
* The groups say fewer whole-farm enrollments in the CRP would reduce economic pressure on tenant farmers, which they say currently account for 70% of U.S. agricultural production. There is strong evidence that the CRP and other US farm programs have artificially inflated land values, the organizations say. But the CRP is particularly "pernicious," they say, because its payments flow solely to landowners and the program puts the US government in direct competition with tenant farmers bidding for land, making rental land scarcer and more expensive.
* USDA should allow some whole-farm CRP enrollments to be bid back into active production, without penalty, the groups say, to enable producers to capture opportunities from what they call the current strong demand for grains and oilseeds while at the same time allowing those acres to be feathered back into production, easing the transition to a smaller CRP.
* Finally, USDA should strictly abide by the stipulation that no more than 25% of available land in a county be enrolled in the CRP, the groups say.
From a news release from the National Grain and Feed Association 12/14/2004 09:30 a.m.CDT
Citing a need to capture growth opportunities and sustain growing demand for grains and oilseeds from the ethanol, livestock and poultry sectors, an alliance of four grain processing and exporting groups is encouraging USDA to make substantial changes in the future direction of the Conservation Reserve Program (CRP). They are urging USDA to consider allowing a "large number" of current contracts to expire and to view Congressional authorization to increase the size of the CRP to 39.2 million acres as a ceiling, not as a mandate.
In particular, they say they think USDA should not simply re-enroll the 16.1 million acres with contracts set to expire in 2007 and the 6.1 million acres that will expire in 2008, but rather focus on those that provide the most significant environmental benefits, particularly to water quality.
Their thoughts were presented in a joint statement submitted in response to USDA’s request for comments on long-term CRP policy.
The groups argue that continued CRP expansion will hamper US agriculture's ability to produce and compete in global markets, and say the size of the CRP already has adversely affected the availability of land to build and grow an economic foundation for the grain, livestock, milling and processing sectors of the US economy.
Further, the organizations say the CRP has had a damaging economic impact on local economies, particularly in the plains states.
Below are some of the groups' arguments:
* USDA should refocus CRP on soil and water-quality improvements, and away from whole-farm enrollments and emphasis on wildlife habitat. The organizations say the environmental benefits index (EBI) used by USDA to evaluate CRP bids should be modified because it currently gives equal weight to soil erosion, water quality and wildlife benefits. They called eequating wildlife benefits to the issues of soil erosion or water quality "irresponsible and not a good use of scarce economic resources."
"A common argument used to d efend the CRP is that it is creating a niche industry catering to hunters and fishermen," the organizations said. "Our members certainly are involved in and support these activities. But should those activities be subsidized through government payments?"
* Idled acres should focus on filter strips, buffers and the most environmentally sensitive lands, with a strong emphasis on substantially improving water quality. Conservation practices should be targeted to working farmland and assist farms to implement soil conservation practices.
* The groups say fewer whole-farm enrollments in the CRP would reduce economic pressure on tenant farmers, which they say currently account for 70% of U.S. agricultural production. There is strong evidence that the CRP and other US farm programs have artificially inflated land values, the organizations say. But the CRP is particularly "pernicious," they say, because its payments flow solely to landowners and the program puts the US government in direct competition with tenant farmers bidding for land, making rental land scarcer and more expensive.
* USDA should allow some whole-farm CRP enrollments to be bid back into active production, without penalty, the groups say, to enable producers to capture opportunities from what they call the current strong demand for grains and oilseeds while at the same time allowing those acres to be feathered back into production, easing the transition to a smaller CRP.
* Finally, USDA should strictly abide by the stipulation that no more than 25% of available land in a county be enrolled in the CRP, the groups say.
From a news release from the National Grain and Feed Association 12/14/2004 09:30 a.m.CDT
