Federal farm aid

begins to sprout
By Scott Nicholson
nicholson@wataugademocrat.com

With a late freeze and an exceptional drought delivering a double whammy to local crop and livestock producers, federal disaster money is trickling in to offset economic losses.

Farmers are still eligible to sign up for the Livestock Compensation Program and the Crop Disaster program, both of which were launched through presidential disaster declarations. U.S. Farm Service agent Bud Smith said the drought caused a severe shortage of available pasture and hay, affecting cattle producers as hay prices soared. Crops were damaged not just by the drought, but by an Easter freeze last year that killed most fruit blossoms.

The Livestock Compensation Program was extended from the original 2005 and 2006 declarations, and Smith said the declaration had been modified to include 2007. Farmers suffering damage from previous years are also eligible to apply if they haven’t already received payments.

For crop growers, it was an especially tough year.

“The freeze started it, getting the fruit trees and apples,” Smith said. “Then it continued with the drought. It made farming a fairly tough occupation last year.”

Smith said it’s difficult to know how much money the county’s farmers will eventually receive, as no set amount of payments have been earmarked. Generally, applications are processed and paid within a week.

Livestock producers are receiving around $10 per animal in disaster payments. The formula is trickier for crop producers, as it depends on whether they received any compensation through crop insurance programs.

From 1995 to 2005, Watauga County farmers received more than $1 million in government disaster payments. Another $840,000 was paid in tobacco subsidies or quota buyouts, with $333,000 going to programs supporting livestock.

Disaster payments varied greatly by year, according to the Environmental Working Group, which tracks farm payments and subsidies based on federal statistics. Over a four-year period beginning in 1995, the county received only about $16,000 in disaster payments. In 1999, the year of flooding caused by hurricanes Floyd, Dennis and Irene, the county received $354,000. Since payments for disasters sometimes are made in the year or two following the event, and weather events are unpredictable, payments can vary greatly each year. In 2004, only $4,900 in disaster payments was issued.

Individual payments also vary greatly. The top disaster-payment recipient in Watauga County from 1995 to 2005 received a total of $85,000, with 10 people receiving $10,000 or more. However, some payments were for as low as a few dollars each.

There are no deadlines yet in place for the Livestock Compensation Program, so Smith encourages farmers and cattle producers to contact the Farm Service Agency at (828) 264-3850 if they have any question about the program.

The year ahead isn’t looking much brighter for farmers, as fertilizer prices have more than doubled since last year. Much of the increase is due to the rise in the cost of petroleum.

“Ammonium nitrate is made from petroleum,” Smith said. “And now it’s up over $800 a ton.”

Fuel prices are also expected to provide a shock to grocery shoppers, as well. The American Farm Bureau conducted surveys in the first quarter of 2008 showing grocery prices had risen about 8 percent over the last three months of 2007.

A five-pound bag of flour rose 69 cents, a dozen eggs rose 55 cents, bread rose 16 cents a loaf, and Russet potatoes rose 18 cents for a five-pound bag. Some commodities declined slightly in price, such as gallons of whole milk, sirloin tip roast and pork chops, while bacon stayed the same.

Farmers are also receiving a lower cut of the consumer’s grocery dollar. In the mid-1970s, farmers received about one-third of the market price of produce. That figure is now down to 22 percent.

The shifts come amid uncertainty about the U.S. Farm Bill, which is under debate in Washington, D.C. and is likely to get an extension, while lawmakers fine tune the legislation. Smith said the current temporary extension is set to expire on April 18.

Smith advocates for an annual amount to be set aside for national farm disaster programs, saying some part of the country will always be affected and will need immediate assistance.

“If they had that, it would allow us to jump on it and help people when they need it instead of waiting for a presidential disaster declaration,” Smith said. “The train runs kind of slow sometimes.”