WASHINGTON, D.C. (RFD NEWS) — The American Farm Bureau Federation (AFBF) is warning that the U.S. Department of Agriculture’s Commodity Credit Corporation (CCC) could soon reach its annual borrowing limit, raising concerns about USDA’s ability to fund key farm programs.
The CCC has a $30 billion borrowing authority each fiscal year, and Farm Bureau Chief Economist John Newton says USDA could approach that limit quickly.
“We’re going to approach the $30 billion borrowing authority pretty quickly, so it’s renewed questions in policy circles on whether the borrowing authority needs to be increased,” Newton warned. “If the Commodity Credit Corporation doesn’t have liquidity, USDA’s hands are really tied.”
Without an increase in the borrowing limit, USDA would need Congress to provide additional funding before the agency could continue making certain program payments. Newton says that if lawmakers do not act, USDA could be forced to delay payments, reduce funding through prorated assistance or make difficult decisions about which programs receive priority.
“Potentially have to delay or prorate these important programs that farmers depend upon without additional borrowing authority,” he explained. “And if USDA is out of liquidity, there’s going to be some important policy decisions that need to be made, or Congress is going to have to step in and replenish the CCC.”
The Commodity Credit Corporation finances a wide range of USDA programs, including commodity support, conservation initiatives, trade assistance and disaster relief. It has served as one of USDA’s primary financing tools for nearly a century, providing the department with flexibility to respond to changing agricultural and economic conditions.
Farm policy experts say the debate over the CCC’s borrowing authority is likely to receive increased attention as lawmakers continue discussions on farm policy and federal spending.
