Farmers will get assistance for the ongoing trade dispute with China under the Commodity Credit Corporation Charter Act (CCC).
The Department of Agriculture will authorize and administer up to $12 billion in programs, in line with the $11 billion impact of expected tariffs on U.S. agriculture.
There are three parts to the CCC. First, the Farm Service Agency will run a market facilitation program to provide incremental payments to soybeans, sorghum, corn, wheat, cotton, dairy, and hog producers.
The USDA will also implement a Food Purchase and Distribution Program through the Agricultural Marketing Service to buy unexpected food surpluses and send them to food banks and nutrition programs.
Third, the CCC will implement a Trade Promotion Program through the Foreign Agriculture Service to develop new markets.
Secretary of Agriculture Sonny Perdue says, "This is a short-term solution to allow President Trump time to work on long-term trade deals to benefit agriculture and the entire U.S. economy,”
In a press conference, the USDA says details on payments will come in in the next couple of weeks and they have been looking at this process since April. Ultimately they only expect this to last one year. They will notify Congress, but the CCC is an existing program and does not need approval.
Iowa Farm Bureau President Craig Hill says farmers want free access to global markets with no tariffs, "We certainly have not heard a clamoring from farmers for financial assistance from the federal government. What we have heard is to end this trade dispute quickly and get back to normal trading patterns and prove our prices to where profits can be achieved in corn, soybeans and pork and many other commodities that Iowa farmers grow."
Other agriculture groups and Iowa leaders agree with the USDA that this year of financial aid for farmers is only a short term fix. The long term solution they add are repaired trade relationships.
Hill was in Washington D.C. last week and had the opportunity to meet with U.S. trade officials. He says the U.S. could be in this trade dispute longer than anticipated. If that's the case, the short term financial aid will add some stability.
Hill says, "But I think the reality is this may persist for some time. So, the financial aid announcement that we received today is a patch. It will help us bridge over to the thinking of next year's crop."