2012 Farm Bill Update
As the primary agriculture and food policy tool of the federal government, the 2012 Farm Bill impacts your business. Ag media outlets have been reporting more about the legislation and the debate over it recently because the current bill is about to expire.
A new farm bill is passed every five to six years by Congress, with the current 2008 farm bill set to expire on September 30. At this time, passage of a new bill will be challenging as Congress typically needs a year or more to enact a new farm bill. With so much discussion happening about the 2012 Farm Bill, we wanted to take this opportunity to help explain some of the proposed changes and let you know where we stand on the issue.
The proposed changes
One proposed change under serious consideration is an end to the $5 billion per year “direct payment” subsidy that is paid regardless of need, and the return of millions of acres of idle farmland to crop production. Meanwhile, farm policy experts and half a dozen major U.S. farm groups are calling for a new crop insurance system that would protect revenue against a disastrous drop in incomes while allowing the government to save money on a five-year farm law. Recently a bill was passed out of the Senate Ag Committee. However, there is still a lot of work to be accomplished before this version could become reality.
The federal multi-peril crop insurance (MPCI) program has been a target for budget cuts in recent years and will be a focal point in the upcoming 2012 Farm Bill legislation. Recent discussions are largely centered on maintaining current funding levels and enhancing the program; however, even the smallest of changes could negatively impact the delivery of the overall program.
John Deere’s stance
John Deere supports a risk management structure that facilitates the production of an abundant, affordable, safe and dependable food supply; and it advocates for all risk management tools to be considered holistically. We support a robust and financially strong federal crop insurance program. Long-term successful availability and delivery of this program for the protection of the American producer requires prudent insurance underwriting practices, private capital commitment and aligned government policy administration.
Advanced technological tools, including use of precision farming technology, can materially simplify, increase accuracy and promote farming best practices, leading to MPCI program efficiency and acceleration of producer productivity to meet global food demand. John Deere Insurance Company continues to support regulatory actions to better enable the use of these tools. View more articles