Ag Groups Urge Prompt Action on House Disaster Bill

WASHINGTON, DC – The National Cotton Council and other national commodity organizations representing producers, processors and related agri-businesses expressed appreciation to Representatives Travis Childers (D-MS) and Marion Berry (D-AR) for introducing legislation that will deliver urgently needed emergency financial assistance to growers who have suffered 2009 crop yield and quality losses due to severe weather.

The organizations also have pledged to work for the legislation’s prompt passage so growers can plan for 2010.

In their letter, the organizations thanked the Representatives for their efforts in delivering much-needed financial assistance to producers and rural communities and assisting them in recovering from devastating losses caused by excessive rain during harvest, hurricanes and other weather-related natural disasters that have affected growers in the Mid-South, Southwest and neighboring states. They pledged to urge other House leaders to work with the group to identify an appropriate legislative vehicle that could be enacted to provide timely emergency financial assistance to farmers and ranchers who have suffered weather-related losses in 2009.

In the face of the compounded financial stress caused by the mounting crop losses and the imminent repayment of production loans, the organizations said the legislation, introduced on December 2 by Representatives Berry (D-AR) and Childers (D-MS), can deliver urgently needed disaster assistance by utilizing a delivery mechanism similar to Direct Payments. The payments would be limited to growers in counties with a Secretarial disaster declaration. The projected cost of the emergency assistance would be offset so there is no increase in the budget deficit.

“Soybeans, cotton, rice, peanuts, sweet potatoes and other crops and segments of the agricultural economy currently are experiencing devastating weather-related losses,” the letter stated. “In some cases, the 2009 losses follow on the heels of similar losses in 2008. To make the situation even worse, the rains in the Mid-South came during harvest so farmers had invested the maximum in inputs to bring the crops to completion only to suffer yield and quality losses, in addition to increased harvest expenses -- which has resulted in severe financial stress. Processors and related businesses that rely upon robust production will operate at reduced levels or not at all, placing stress on these small businesses and their rural communities.”

They stated, “This delivery mechanism offers the combination of timely financial assistance for yield and quality losses that can be delivered with minimal administrative burden on USDA.”

The organizations also noted that although loss estimates are preliminary, they already have reached the hundreds of millions of dollars. They emphasized that many producers need assistance within weeks to repay loans and secure new financing in time for spring planting -- any alternative means of providing assistance, however well-intentioned cannot be delivered before late 2010 or early 2011.

David Cochran, an Avon, Miss., cotton producer, said the 30-plus inches of rain he received in September and October “cost us anywhere from 50-60 percent of our anticipated yield. We felt like we had one of the better cotton crops that we’ve had in recent years, but a lot of the cotton either hardlocked and fell out or just rotted.”

He said this year has been unusually devastating and the immediate disaster assistance such as that introduced in the Senate and House would help him meet his financial obligations.

Cochran said his ginning operation also was hurt because of the lost seed. “We gin for the seed, and where we normally get 700-800 pounds of seed per bale, we’re only seeing 550-600 pounds,” he noted.

Dow Brantley, an England, Ark., cotton producer still suffering from the 2008 hurricane’s effect, planted 850 acres of cotton this year only to see the rains drench his late crop and rob him of 300-400 pounds of cotton per acre as well as an average of two cents per pound on quality discounts.

“If we’re fortunate enough to get some type of assistance, it will help but we’re still going to have a loss – no way around it,” Brantley said. “If we don’t get assistance, we’ll spend the next couple of years just trying to get out from under this loss. I can weather one but not two years in a row. You just can’t lose this much cotton with the costs of the inputs it requires to make a crop.”