Ag economists weigh in on farm bill, Trump budget
Some ag economists have told the Senate Ag Committee what they think the next farm bill might need. USDA Chief Economist Dr. Robert Johansson testified that some 2014 Farm Bill programs are popular, some not. “Crop insurance programs changed quite a bit in the last farm bill. We added a lot of, we added whole farm revenue which has been popular. We added STAX (Stacked Income Protection Plan) which is not popular. So, as you look for new Title 11 programs, I think you’re likely to see the ability to make some adjustments there.”
He also says there are issues with the dairy Margin Protection Program. “On the dairy side, the new program for dairy margins has not been very popular with the dairy sector and so I imagine there will be opportunities to look at changes to the dairy programs as well.”
Federal Reserve Economist Dr. Nathan Kauffman also says lawmakers will want to watch certain trends, like deterioration in financial liquidity. “We’ve seen persistent cash flow shortages the last several years, (and) demand for financing. As profit margins have remained weak, we’ve seen liquidity decline. That would be the first (suggestion to the committee), is just monitoring the trend in liquidity.”
Kauffman says real estate values have been strong enough to keep farms solvent but says debt to asset ratios could be in trouble if economic conditions worsen.
Senator Heidi Heitkamp of North Dakota asked the panel if any of them supported the proposed President Trump budget and its cuts. After a moment of silence, she said, “I didn’t think so.”
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