Farm groups push for farm bill with modified PLC
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WASHINGTON, June 14, 2013 - Several groups, including the American Soybean Association (ASA), urged the House Thursday to quickly consider and pass its five-year farm bill (H.R. 1947), but with changes to the Price Loss Coverage (PLC) program option.
In a letter to lawmakers, ASA, the National Corn Growers Association, the National Sunflower Association and the U.S. Canola Association said they support many of the programs in the bill.
“The bill would consolidate conservation programs, reauthorize and fund agricultural research, energy, and export promotion programs, and make improvements in federal crop insurance,” the letter said. “We strongly support these provisions, and ask that you oppose any amendments which would eliminate or weaken them.”
ASA President Danny Murphy said his organization is encouraged by the momentum that the farm bill has going into the House.
“We are convinced that lawmakers can work together to pass a bill that both supports agriculture and confronts our budgetary obligations responsibly,” Murphy said.
The groups noted, however, their concern with the bill's PLC program option, which they argued would set high, fixed reference prices for program crops which, in some cases, exceed their historical prices and cost of production; and tie payments to producers to crops they grow in the current year. The groups said this could distort planting decisions and production if market prices fall below their support levels.
“Since the 1996 farm bill…farm policy has provided planting flexibility, encouraging producers to respond to market signals in making their planting decisions rather than to the prospect of receiving government payments,” the letter said.
They said the program should be modified to make it responsive to the market rather than the government.
The groups said they support a possible amendment from Rep. Bob Gibbs, R-Ohio, that would address their concerns by setting reference prices at a percentage of recent average market prices, which do not exceed production costs. The amendment also would provide for payments on historical crop acreage bases rather than on current-year plantings.
“These changes would make the PLC program more market-oriented and significantly reduce the risk of distorting planting decisions and production,” the groups said. “They would also reduce the likelihood of the program violating U.S. commitments under the WTO. Moreover, they would achieve an estimated $10 billion in savings in addition to the committee bill.”
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