Ernst Gauges Tolerance for Farm Insurance Caps in Monroe08/29/2017
Staff at Two Rivers Cooperative in Monroe told U.S. Sen. Joni Ernst Wednesday any acreage payment caps on federal crop insurance put into the new farm bill could be a “major concern” in producer viability.
During a one-hour round table discussion at the co-op, the Republican senator said the farm safety net is the No. 1 issue she hears about from the farm community. The Jasper County stop was the senator’s 85th on her 99 county tour.
The discussion Wednesday mainly focused on agricultural issues like crop insurance, the EPA’s renewable fuel standard and concerns about the future of ag-trade related to the renegotiation of NAFTA, but Ernst and the co-op staff broadened the conversation to include health care, infrastructure spending and the current tense rhetoric in Washington, D.C.
Tracy Gathman is general manager of Two Rivers Cooperative, based in Pella. He said despite a lack of sufficient soil moister, a few timely rains in central Iowa have put Jasper County crops in a relatively healthy spot. But the farther south he travels, the quality of drought stricken crops becomes more apparent. Gathman said Iowa farmers will not have a bumper crop in 2017 to offset low grain prices, making crop insurance essential.
“The future of crop insurance is vitally important,” Gathman said. “Having that safety net underneath the producer so (insurance) is viable and affordable but still able to protect our producers as we move through with the uncertainty due to the weather (is important).”
Ernst sits on the Senate’s agriculture committee, which will resume hearings on the new farm bill following the August Congressional recess. Iowa’s senior U.S. Senator, Republican Chuck Grassley who also sits on that committee, has been critical on sending crop insurance payments to wealthy landowners who are not involved in the farming on their property. At the Iowa Ag Summit in Des Moines earlier this month, he said crop insurance subsidies would likely be part of the new farm bill, but capping the number of acres subsidized could help the $20 trillion federal debt.
In Monroe on Wednesday, Ernst asked the round table its thoughts on payment caps to crop insurance.
“Should (crop insurance) be there to protect the small, beginning family farmer? What about those guys farming 10,000 acres? What are your thoughts?” Ernst asked.
Gathman sees it as a misconception that the “bigger guys” are able to afford yield and crop loss. He told Ernst larger farm operations have more invested and more risk.
“Insurance coverage is insurance coverage. It doesn’t matter if you drive a $2,000 automobile or a $200,000 automobile, you’re going to pay a different premium on that based on the level of coverage you’re asking for per acre, but I don’t think a cap on acreage size dollar payments would be very fair. In many ways it would give our industry in farm cooperatives major concern from the standpoint of producer viability.”
Ernst said the difficulty in negotiating the new farm bill will not come in the agriculture committee, but once it gets to the full Senate floor. She said farm safety net subsidies are a harder pill to swallow for lawmakers from states with less investment in agriculture. But continued funding for programs like SNAP, also part of the farm bill, will make the legislation important to the broader body of senators.
“It’s why we’re trying to keep it tied to the food and nutrition aspect (of the farm bill) so they do have some incentive,” Ernst said. “If we see them pushing some of those programs to us in ag states, then we can push back on some of the things that they want to see.”
Questions about the uncertain future of ag-trade under the North American Free Trade Agreement, or NAFTA, also topped the questions by the Monroe-area producers. Local farmers could take a hit if trade with markets like Mexico become more complex, as President Donald Trump’s administration begins to renegotiate the long-standing free trade agreement.
There was concern in the room that drafting bilateral trade agreements will make it more expensive for Iowa farm goods to reach overseas markets.
Ernst said she hopes the involvement of USDA Secretary Sonny Perdue will keep ag-exports, particularly to Mexico, a key component of the renegotiation.
“I thought (Trans-Pacific Partnership) was brilliant. It worked for Iowa because of our ag-exports. Unfortunately, we don’t have a president who is supportive of that initiative,” Ernst said. “Now we’re in a bilateral agreement game and working with those individual counties. I think it can work but it’s a little more difficult, doing bi-lateral negotiations. But it can work.”
Source: Mike Mendenhall, Newton Daily News