The USDA has recently released details of the Market Facilitation Program (MFP) for the 2019 crop year. This is the second year of the MFP and includes a $16 billion package intended to compensate American farmers damaged as a result of the ongoing trade situations.
According to US Agriculture Secretary Perdue, “China and other nations have not played by the rules for a long time, and President Trump is the first President to stand up to them and send a clear message that the United States will no longer tolerate unfair trade practices. The details we announced today ensure farmers will not stand alone in facing unjustified retaliatory tariffs while President Trump continues working to solidify better and stronger trade deals around the globe.”
“Our team at USDA reflected on what worked well and gathered feedback on last year’s program to make this one even stronger and more effective for farmers. Our farmers work hard, are the most productive in the world, and we aim to match their enthusiasm and patriotism as we support them,” Secretary Perdue added.
MFP signup began July 29 and will continue until December 6. Farmers must sign up for the program at local FSA offices. Landowners may also participate in the MFP, as long as they are under a crop share agreement and not a cash rent agreement. Payments under this program are based on 2019 planted acres. All qualifying acres must be planted by August 1 of this year. Qualifying crops include corn, extra-long staple cotton, long grain and medium grain rice, peanuts, sorghum, soybeans, upland cotton, wheat, and more. Last year’s MFP payments did not include rice or peanuts.
The 2019 MFP also includes cover crops on prevent planted acres as long as the cover crop was planted prior to August 1. Those cover crop acres are eligible for a $15 per acre payment. Acres that were never planted in 2019 and converted CRP acres are not eligible. Payments will be based on the total planted acres of each commodity on a given farm. The total acres eligible for payments cannot exceed the amount of eligible crop acreage that was planted in 2018, except for any acres added via purchase, land rental contracts, family arrangements, etc.
The payment rates of the program will vary by county. Nationwide, these rates vary from $15 to $150/acre. In Arkansas, the rates vary from $19 to $134/acre. The average rate across the state is $66/acre. In Missouri the rates vary from $15 to $125/acre, with the average rate being $60/acre. For Mississippi the rates vary from $21 to $150/acre, with the state average rate being $87/acre. The rates for Tennessee vary from $16 to $126/acre with an average of $62/acre.
MFP payments are being capped at $250,000 for non-specialty crops per person or per legal entity. No applicant may receive more than $500,000. Applicants must also have an average adjusted gross income (AGI) of less than $900,000 or have 75% of the average AGI come from farming or ranching for the tax years of 2015, 2016, and 2017 in order to qualify.
The payments will be made in up to three installments. The first installment will consist of the highest of either 50% of a person’s calculated payment or the minimum $15 per acre. This payment started in mid-to-late August. The second and third installments will be made as market and trade conditions dictate. If conditions warrant, USDA will make the second installment in November, and the third will be paid in January. Information on payments by county can be found on www.farmers.gov.