Published on 04/07/99

No Disaster Relief Money for Most Farmers Until June

U.S. Agriculture Secretary Dan Glickman says most farmers won't get the $2 billion earmarked for special crop disaster aid until after the spring planting season.

Congress approved the payments for the crop loss disaster assistance program last year as part of a $6 billion aid package.

Purpose of aid

"It was designed to help U.S. farmers hard hit by several years of crop losses to disease, weather and slumping commodity prices," said Bill Thomas, an economist with the University of Georgia College of Agricultural and Environmental Sciences.

Glickman said so many farmers have applied that they've overwhelmed the U.S. Department of Agriculture. The paperwork needed to figure each farmer's eligibility and prorate the $2 billion among qualifying applicants has also slowed the payments.

Exactly what this means for Georgia farmers will vary.

Aid payments may come too late

J. Cannon, UGA CAES
high-res photo available

Tractor in dusty field.

DRY FIELDS don't offer much hope for many farmers in south Georgia. Some are planting in spite of continuing dry weather, and know they aren't likely to make money on the crop. Aid payments from USDA are slow coming and may be too late for many farmers already hit hard by years of low prices and uncooperative weather.

"Losses have to be 35 percent of production history. So every farmer will be different," Thomas said. "Prices are still low for many crops. Some farmers are planting knowing they won't make money on this crop."

Anything they can get will help them hold on for one more year and hope for better times.

"An Extension Service agent from south Georgia tells me it's beginning to be really dry," Thomas said. "Of course, that could mean poor yields on top of poor prices this year."

Better news for dairies

While the outlook is bleak for crop farmers, dairies might see relief sooner. And they deeply need it.

The fall in the basic formula price for milk announced March 5 was the sharpest monthly decline of milk prices ever. It more than doubled the previous record monthly decline.

Thomas said the dramatic drop will give Georgia dairy farmers the lowest price for their milk since 1991.

"The USDA is releasing $200 million to help dairy farmers facing greatly reduced milk prices," he said. "Dairy farmers can collect payments of up to $5,000 each under the new Dairy Income Loss Assistance program."

Targetted to family-sized farms

Under the plan, the USDA will make payments based on a dairy farm's first 2.6 million pounds of milk in 1998 or 1997, whichever is the highest.

"Targeted to family-sized farms, the plan is based roughly on the annual production of 150 cows," Thomas said. "The average herd in Georgia is 211 cows. So in Georgia, the average dairy farmer will be capped at $5,000."

All dairies that produced milk during the last quarter of 1998 are eligible. The final payment rate per hundredweight will be calculated after the sign-up ends.

"The USDA now figures it will be between 18 and 20 cents per hundredweight," Thomas said. Farmers may apply at their USDA Farm Service Agency office from April 12 until May 21.

Faith Peppers is the director of public affairs with the University of Georgia College of Agricultural and Environmental Sciences.