Ranchers wait while Congress debates farm bill
Friday , September 21, 2012 - 8:22 AM
CASPER, Wyo. -- Westernranchers want two things: rain for their pastures and the U.S. House to pass the 2012 Farm Bill.
In the unlikely scenario the House passes the bill by its Sept. 30 deadline, manyranchers would be able to receive compensation for cattle lost in forest fires and reimbursements for the high price of forage caused by the drought.
Many in the state are skeptical the bill will pass the House.
"If I had a dollar, I would bet that it won’t happen," said Jim Magagna, executive vice president of the Wyoming Stock Growers Association.
He said the ranchers who’ve faced the brunt of Mother Nature’s misfortunes this summer will "have to wait for payments" if the bill isn’t passed or extended.
Four billion dollars worth of United States Department of Agriculture programs that would have immediately compensated ranchers for their losses expired last September, leaving many ranchers in a bind during a summer when the worst drought in 56 years ravaged the West. An extension or passage of the bill re-enacts the disaster relief programs. If Congress doesn’t pass the new bill or extend the old one, other USDA programs that help the agriculture industry will expire.
Since many of the disaster relief programs expired last year, Magagna said the Noninsured Crop Disaster Program has helped ranchers who earn less than $100,000 per year. If ranchers didn’t register for the program, they weren’t eligible to receive compensation. If the 2012 Farm Bill is not passed, ranchers will not be able to enter the program, he said.
"Without the farm bill or some emergency program by Congress, the only thing we have is the 1/8Noninsured Crop Disaster Program 3/8," said Gregor Goertz, state executive with Farm Service Agency.
Since many ranchers have to "go without insurance," said USDA spokesman Matt Herrick, "the lifeline" of many ranchers in Wyoming were the disaster relief programs.
The Emergency Conservation Program is available to farmers or ranchers who face losses from natural disasters. The program helps them re-establish water supplies and fix damage caused by forest fires and, as was the case last year, make repairs caused by flooding.
Herrick said the Emergency Loan Program is also another option for farmers and ranchers facing losses.
In the 2008 Farm Bill, there was a new provision for livestock insurance. It is expensive, and the federal government funded it at a low level.
"The demand was high and strong," Herrick said. "When there’s a sign-up for the program, it fills up in minutes."
Without the passage of the new bill or an extension, the livestock insurance won’t be available for 2013.
The U.S. Senate passed the farm bill in June, but it’s been sitting in the House since.
In a statement to the Star-Tribune, Sen. John Barrasso, R-Wyo., said "The Senate Farm Bill gives Wyoming’s farming and ranching communities the certainty and stability to make long term business decisions."
Sen. Mike Enzi, R-Wyo., wants the Farm Bill addressed as soon as possible, said Daniel Patrick Head, spokesman for the senator, in an email to the Star-Tribune. "We should pass it."
The centerpiece of the legislation is crop insurance. With the government paying 60 cents for each $1 in premiums today, cost reduction was at the heart of the bill. The $5 billion-a-year program giving direct payments to farmers and ranchers ended. The Senate reduced premiums for farmers making more than $750,000 a year. And the Senate also added a requirement for farmers to practice soil, water and wildlife conservation in order to receive subsidized insurance.
"The 2012 farm bill addresses agriculture totally different than the 2008 bill," said Perry Livingston, an independent rancher and president of the Wyoming Farmers Bureau Federation. "My organization helped craft it. ... We think it’s a better way of presenting crop insurance, and it gives all of us producers a better way to protect their investment."
Unlike car insurance, the average rancher can’t afford livestock insurance and a farmer can’t afford crop insurance. It’s only underwritten by the federal government. If a rancher or farmer faces losses without the government insurance, "it comes out of pocket," Livingston said.
"Folks that have been able to keep their ground wet have been able to grow valuable commodities," said Ken Hamilton, Wyoming Farm Bureau executive vice president. But many of the state’s cowboys aren’t so lucky.
Hamilton said many of the state’s ranchers don’t have any forage for their cattle because of the drought.
"If you don’t have any forage, you got to buy hay. Hay prices have doubled in the past year. And 1/8ranchers 3/8 just can’t afford that," Hamilton said.
The hay price is up to $220 a ton, from $130 a ton in 2011. And with the price of corn having hit record highs in August, Hamilton said many ranchers are selling off their livestock at a time when the price is declining.
"So many people have had to liquidate their herds," said Bill Bensel, organizer for the Powder River Basin Resource Council. "How are they going to get back into the industry?"
The grain, fruits, vegetables, poultry and livestock affected by the drought are not just a burden on the agriculture industry, Livingston, the rancher, said. "It comes through to the consumer, too."
The government’s forecast, based on the consumer price index for food, estimates a 4 to 5 percent jump in beef prices next year.
Last week, U.S. Rep Bruce Braley, D-Iowa, introduced a petition to get the bill on the House floor. As of Monday, 58 representatives signed the petition.
"It needs 218," Magagna, of the Wyoming Stock Growers Association, said. "I wouldn’t bet on it."
If the petition receives the required number of signatures, House rules won’t require the farm bill to be brought to the floor before the election, said Christine D’Amico, spokeswoman for Rep. Cynthia Lummis, R-Wyo., in an email to the Star-Tribune.
"Given that, her reaction is to allow the farm bill to expire. She believes there is a better chance for resolution if the farm bill lapses," D’Amico wrote.