Agriculture improvement Act of 2018

Floor Speech

BREAK IN TRANSCRIPT

Mr. ROUNDS. Madam President, I rise today to discuss the Agriculture Improvement Act of 2018, or what is commonly known in our part of the country as the farm bill, which we are considering on the Senate floor this week.

The farm bill is a vital piece of legislation to the people of my home State of South Dakota, where our economy depends on agriculture to survive. With more than 31,500 farms across the State, South Dakota ranks in the top 10 for ag production, providing a $25 billion impact on our economy annually. Stability and certainty for our farmers, which this farm bill helps to provide, is crucial as they do their part to feed and fuel a growing global population.

I would like to thank Chairman Pat Roberts, Ranking Member Debbie Stabenow, and all of the other members of the Senate Ag Committee and their staff, who worked tirelessly to get this marketed-oriented bill to the floor for consideration by the full Senate body. This bipartisan bill will provide much needed certainty to our ag community at a pivotal time, when the ag economy is facing significant challenges. The ag economy is down more than 50 percent over the past 5 years, and the numbers don't look much better for 2018. According to the Department of Agriculture's own Economic Research Service, net farm income is projected to fall an additional 7 percent this year to $58 billion.

A 5-year farm bill is necessary to give South Dakota producers the certainty they need to help weather times of economic downturn, such as the one we are experiencing right now in ag country. Additionally, the uncertainty surrounding trade and tariffs has created instability in the market, which is having a significant effect on our commodity prices.

For example, in my home State of South Dakota, soybeans are one of the top commodities, and we rely heavily on exports to sell our soybean crop each year. A significant importer of U.S. soybeans is China, which accounts for about 25 percent of all of the U.S. soybean sales and 60 percent of all soybean exports.

While the tariffs on soybeans have not taken effect yet, they are already having a real impact on the market prices. Since the tariffs on Chinese goods were announced in early March, soybeans are down $1.86 per bushel on the cash market, representing a $449 million loss in South Dakota alone when we look at farmers' balance sheets. The USDA had projected ag exports to be flat in 2018 before tariffs were levied on the ag industry--or at least before those tariffs were suggested to be added to the ag industry.

With so much uncertainty surrounding trade deals since tariffs were announced, reauthorizing programs like the Market Access Program, or MAP, and the Foreign Market Development Program, FMD, are vital to help gain access to new markets for U.S. products. This bill does exactly that.

These programs help encourage the development, maintenance, and expansion of the ag export market to foreign customers.

I am pleased that this legislation also strengthens the crop insurance program with outlays projected to be approximately $7.6 billion annually. Crop insurance is a highly effective public-private safety net that helps farmers customize protection for their individual operations. Sometimes I don't think we emphasize that this is one of those safety net items for which farmers and ranchers actually pay premiums to participate. Crops in my home State of South Dakota contribute roughly $10.3 billion to our economy. Last year, in South Dakota alone, more than 50,000 crop insurance policies were written to provide $4.8 billion in protection for over 17.5 million acres of cropland. Nationwide, more than 310 million acres were enrolled in crop insurance, backing more than $106 billion of crop value. It is vital as a risk management tool for farmers across the entire country. By maintaining strong crop insurance provisions, this bill will help our producers weather these very tough times in ag country.

Additionally, this legislation provides a modest increase in the cap of the Conservation Reserve Program, or CRP, to 25 million acres. That would be up from 24 million acres currently in the existing farm bill. While we would have preferred a more significant increase in CRP acres, to the tune of perhaps 30 million acres or more, a strong CRP program is an important tool to assist farmers and ranchers during these adverse times, such as during a drought like we experienced in South Dakota last year, or possible flood damage, which I fear we will be experiencing this year.

This legislation also gives the Secretary of Ag the necessary authority to reorganize the USDA. Ag Secretary Sonny Perdue recently introduced a plan to reorganize the agency, including combining the Natural Resources Conservation Service with the Farm Service Agency and the Risk Management Agency, creating a new farm production and conservation mission, which would be under the Under Secretary, Bill Northey. Streamlining these programs will help sharpen the agency's focus on domestic agricultural issues, providing farmers and ranchers with a one-stop shop so that USDA can better meet their needs.

Last year, as the Senate Ag Committee discussions on this farm bill took shape, I wrote to the chairman and ranking member of the committee to ask them to establish a foot-and-mouth disease vaccination bank to combat economic, food, and national security concerns. A major outbreak of foot-and-mouth disease, or FMD, would be financially devastating to our producers, and I am pleased this bill highlights an FMD disease bank as a priority at USDA.

The final thing I will mention about the Ag Improvement Act of 2018 is that it increases the cap for individuals seeking loans under the Farm Service Agency loan guarantee program. This program provides financial assistance to farmers and ranchers who want to expand and improve their operations. Under this legislation, the FSA direct loan program cap will go from $300,000 to $600,000 for direct ownership loans, $400,000 for direct operating loans, and from $1.39 million to $1.75 million for guaranteed ownership and operating loans. Increasing both the individual cap for these loans and the total amount of money available for lending will allow a greater number of producers to utilize the program. Farming and ranching have become increasingly costly, and increasing these limits will more accurately reflect inflation and increasing costs of ag production today and make sure that lenders have flexibility during times of hardship.

South Dakota producers work hard every day to feed and fuel a growing global population. As in all businesses, some years are simply better than others. During those more difficult times, it is important that our farmers and ranchers have access to tools that can help them keep their operations vital. The certainty and stability of this farm bill will do that by allowing them to work to weather this current economic downturn, as well as strengthen the agricultural economy.

I support the Senate's efforts to provide certainty to our farmers, and I will continue to work with my colleagues to see this bill across the finish line so that we can provide our ag economy with much needed certainty and help get our ag economy back on track.

Let me also add that I believe we may very well see some very well- meaning amendments today that make good sense, but these amendments might very well not be supported by enough of our Members to where the actual bill itself would survive if the amendments were included. My interest is in making certain that this farm bill is allowed to continue forward, to be reconciled with the House, and become law as quickly as possible. I would ask the other Members to seriously consider the impacts; while we may very well have some great ideas on how to make improvements, unless we have enough to maintain that 60- vote margin in the U.S. Senate on a bipartisan basis, then we will have failed in providing that stability to the ag community in this time when they desperately need that reassurance.

With that, Madam President, I thank you for the opportunity to visit and talk about this very important piece of legislation.
BREAK IN TRANSCRIPT

Source