Strike up a conversation with a farmer in recent years and invariably the discussion turns to the issue of payment yields and acreage bases.
As most growers know, payment yields or program yields have been capped at levels recorded prior to passage of the 1985 farm bill. Most acreage bases were built prior to the 1996 law or Freedom to Farm.
When Congress passed the latter, it said the Farm Service Agency would multiply a farmer's program yield by his acreage base and the payment rate to determine his Agricultural Market Transition Act payment.
Many producers, especially those with corn and rice, improved their yields substantially since the mid-1980s. But they have been unable to “profit” from those gains because congressional leaders have been unwilling to review the 1985 cap on yields for payment purposes.
Likewise, many producers who have shifted acres into other crops are stuck with the acreage bases they had when the 1996 FAIR Act was signed into law.
Members of Southern Cotton Growers Inc., which represents producers in Alabama, Florida, Georgia, North Carolina, South Carolina and Virginia, have been pushing to change the latter through what they call a “modified base” concept.
The modified base concept would give growers of all commodities a choice to receive any future, direct payments at the higher of their current frozen base or a more recent planting history. The latter would be similar to the earlier farm bill provisions that allowed growers to increase their base over time.
Southern Cotton Growers leaders estimate that 50 percent of the cotton acres in the Southeast are not eligible for the cotton AMTA payment or receive a much-reduced payment for another crop such as corn or wheat.
“We are cautiously optimistic that we will be successful in achieving this objective in the next farm bill,” said Roy Baxley, a farmer and the president of Southern Cotton Growers Inc. from Dillon, S.C. “However, such a change would not benefit our region until the 2002 crop at the earliest.”
Baxley said the association must convince Congress to allow for the use of the modified base concept in the disbursement of any 2001 market loss payments. “Otherwise, Southeast cotton producers will again be cheated out of millions of dollars for the fourth year in a row.”
Writing to his members, Baxley noted that the U.S. House of Representatives has approved a 10-year budget resolution that allows for the reform of the commodity title of the current Freedom to Farm policy. It also reserves funding in the 2001 fiscal year to offset lost income from high fuel and fertilizer costs and depressed commodity prices.
“We believe that the basis for a new farm bill will again be centered on providing assistance to producers via direct payments,” he noted. “Our main emphasis in this debate will be in support of a much higher budget baseline for farm program spending, higher loan rates and the incorporation of the modified base concept.”
Baxley said each member of Congress in the organization's region has been approached about the modified base concept. “But it may take hearing from their constituents personally to make a difference.”