NPPC Update Regarding USDA Coronavirus Food Assistance Program Details

May 20, 2020 — 

Today, USDA formally unveiled details of its Coronavirus Food Assistance Program (CFAP), which provides direct payments to farmers impacted by the COVID-19 crisis. The program includes $3 billion in planned agricultural product purchases and $1.6 billion in direct payments to hog farmers. [Source: NPPC 19 May 2020]

According to the details announced today, CFAP will:

• Provide payments directly to farmers who have suffered a five percent-or-greater price loss and who are facing significant marketing costs due to COVID-19. USDA intends to issue a single payment to each eligible producer, with the total calculated based upon the two funding sources: the CARES Act and the Commodity Credit Corporation (CCC). The CFAP final rule defines hogs as "any swine 120 pounds or more" and pigs as "any swine weighing less than 120 pounds." Under the CARES Act, payment for income loss will be based on the actual sales of hogs and pigs sold between Jan. 15 and April 15, 2020, multiplied by the CARES Act rate ($18/head for hogs, $28/head for pigs). Payments from CCC to aid in the removal or disposition of surplus agricultural commodities and for additional marketing and production costs will be based on a producer's unpriced hog and pig inventory between April 16 and May 14, 2020, multiplied by the CCC payment rate of $17/head for hogs and pigs;
• Provide eligible farmers with 80 percent of the total payment, up to the payment limit, upon approval of the application. The remaining 20 percent will be paid at a later date as funds remain available; and
• Include payment limitations of $250,000 per individual, as well as a $900,000 Adjusted Gross Income limit for individuals who do not derive 75 percent or more of their income from farming. Corporations, limited liability companies and limited partnerships that can certify that up to three members of the corporate entity provide at least 400 hours of active personal management or personal labor may be eligible to receive payments up to three times the limit.

Direct support sign-ups will begin on May 26, through local Farm Service Agency (FSA) offices, and run through Aug. 28. USDA aims to distribute payments within one week of applying for assistance. For more information, including the necessary FSA forms, visit farmers.gov/cfap.

Today's announcement reinforces the urgency for NPPC investors to continue to urge the Senate to support the livestock agriculture provisions in the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, which offers meaningful relief and includes:

• Compensation for euthanized livestock that can't be processed into the food supply due to COVID-related packing plant capacity reductions;
• Expanded direct payments to livestock farmers who have suffered severe losses as COVID-related market disruptions have caused the value of their livestock to plummet;
• Increased funding for animal health surveillance and laboratories, which have been tapped to perform COVID-19 testing during this human health emergency; and
• Mental health assistance for our farmers who face a financial and emotional crisis.

NPPC encourages you to continue to reach out to your senators, urging support for these provisions, which represent a critical lifeline for our hog farmers struggling to weather this storm.