News

December 18, 2008

Will The New Chief Of The USDA Be A Friend To Farmers?

Charles Wyatt

A towering in-tray is already piling even higher on the empty Secretary’s desk at the US Department of Agriculture. Awaiting decisions on the US mammoth agriculture subsidies are not just US corn farmers, ethanol producers and traders, but a long list of countries who object to the US massive farm subsidies and export lock-outs, including Brazil’s ethanol industry. Betting has been that President elect Obama is appointing Tom Vilsack, in which case he will have chosen a pro.

The  US$289 billion, five-year farm bill Congress passed in June remains unimplemented, with decisions on how to structure crop subsidy programs yet to be made. The shape of a new subsidy based on farm revenue rather than crop price still has to be determined. Depending on what formula the government chooses, farmers may decide whether to plant corn or soybeans based on how much support they may receive.

Pressure to make subsidies generous is rising as corn, wheat and soybean prices...