American Soybean Association hosts Farm Bill Session on Reference Prices

The American Soybean Association hosted 12 Farm Bill listening sessions where farmers told them the soybean reference price is insufficient.

Brad Doyle, ASA President, said it should have kicked in during the 2018 China Trade War.

“Soybean prices fell about 20% but soybean producers received no PLC payments and little from ARC under the title one safety net. The reference price for determining title one benefits was set at such a low level, that PLC payments never were triggered.”

They haven’t been triggered for soybeans since 2005. Reference prices aren’t working for the rice industry either according to Jennifer James with USA rice.

“The PLC benefit to rice is down 75% from where it stood in 2019. The payment rate per pound for 2021 is projected to be about 1/3 the rate it was last year. Current plc reference prices were established based on 2012 costs and production. They were still relevant when the 2014 farm bill was enacted.”

She says rising input costs have made the system ineffective and cited a Texas A&M study projecting rice farmers could lose over $500 million this year because of high costs and low prices.

Rep. Austin Scott also focused on inputs and read revenue figures from Mosaic Fertilizer’s annual shareholder report that showed wide profit margins.

“I think that what Americans need to realize is the monopolization of the inputs on our food supply to our farmers is what’s leading to the majority of the discussion right here is that the input costs are going up faster than the markets can absorb them.”

Mosaic has requested tariffs on fertilizer imports which they say are heavily subsidized. The national corn Growers association is asking lawmakers to oppose them.

“One of the things we’ve learned in the process is they do not look at this table as their customer. They are selling to the CHS and Growmark to the world. That’s their distributor work. And so, our pushback on Mosaic or CF Industries on nitrogen fertilizer has been a surprise to them. Because we’ve never pushed back before because of the process and the engagements we’ve had.”

Aside from rising input costs, NCGA President Chris Edginton did say implementation of the 2018 Farm Bill has been fairly smooth for corn producers.

Related:

U.S. Rice Price Prospects are Improving

Soy farmers stressed, need better broadband, according to ASA survey






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