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Lack of New Farm Bill Would Affect, Farmers, Consumers in the New Year
Posted on: 10/10/2013
By  Andy Rex
 
One of many other news developments lost in the wall-to-wall news coverage of the shutdown showdown in Washington is the fact that the U.S. Farm Bill expired last week.
The previous Farm Bill was passed in 2008. It was given a one year extension last year, then it expired from lack of action on September 30. 
 
So, what could people see as some effects of the nation not having this major piece of legislation in place?
 
WMOA News posed that question to Dr. Carl Zulauf, an Agricultural Economics Professor at the Ohio State University. He says in the short-term, people probably won’t see much effect. But, he says, if something isn’t done by the end of the year, that could change… 
 
“We would revert to the parity prices on milk as the support level.  Congress has demonstrated repeatedly that it’s not going to let those prices come into existence – for example, last year.  I would be surprised if they allowed it to happen this year if they didn’t allow it to happen last year.”
 
Parity prices are based on a 1949 law which, at the time, guaranteed that farmers would be paid for dairy products relative to the cost of living. The problem is: the original calculations were based on conditions prior to World War I and were never updated.  That could mean the price of dairy products could rise dramatically – by 50 percent or more. 
 
As for crops, Dr. Zulauf says there should be no real impacts until spring of next year…
 
“The grains are for crop years, So when they extended the legislation last year, it covered the 2013 crop year, which takes you through the end of the crop year, which I believe the earliest one is May, when the wheat crop year ends.  And, it would take you all the way through August.  So, there would be consequences for the 2014 crop.”
 
He says that’s primarily related to wheat planting, as most farmers look at government programs as a means of supporting their incomes. He says prices are high enough right now, that that’s not likely to have as much effect as it normally would have.
 
Much of the argument that stalled a new Farm Bill is over the Supplemental Nutrition Assistance Program (SNAP), previously known as the food stamp program.  Zulauf says that will remain unaffected for now, because the USDA won’t run out of money for that program until the end of the year. A separate Senate bill reduced SNAP funding by $4 billion over 10 years, while a House bill had 10 times the amount of cuts.
 
So, where is all of this headed? Professor Zulauf thinks it could end up as a part of omnibus budget legislation…
 
“There would be the possibility that a Farm Bill could get attached to some sort of all-encompassing debt and spending resolution. The common thinking is that, if that happens, it would likely be another extension. It would not be a new Farm Bill.”
 
The professor says anyway you look at it there is not a quick solution to a new Farm Bill on the horizon.
 
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