April 14, 2020

 

USDA to spend US$15.5 billion in farm aid

 

The US Department of Agriculture will spend up to US$15.5 billion to enhance the country's food supply chain that has been affected by COVID-19, three sources told Reuters.

 

The plan set to be announced soon will be the Trump administration's plan to sustain food supply as meatpackers shut down, dairy producers dispose of milk and farmers struggle to hire workers.

 

The US$15.5 billion will be used as direct payment towards farmers and ranchers, as well as additional support such as part of a US$23.5 billion Congress approved funding to assist the agriculture industry in a coronavirus stimulus bill.

 

The sources told Reuters that the USDA will announce the initial plan this week, and go into further detail later in July.

 

Andrew Walmsley, director of Congressional relations for the American Farm Bureau Federation said they see it as a first step, expecting additional aid coming soon.

 

The other two sources did not want to be named. The USDA declined to comment.

 

Several beef and pork meatpacking plants have been closed as workers are affected by COVID-19. Smithfield Foods said it will shut one of its plants in the country indefinitely after workers were infected by COVID-19, warning that food supplies for retail is decreasing.

 

The CARES Act will see lawmakers allocate US$9.5 billion to the USDA to help livestock producers, fruit farmers and vegetable growers.

 

The rest of the money will come from the Commodity Credit Corp (CCC) funding authority.

 

A USDA spokesman said an additional US$14 billion has been added by the CARES Act to the CCC but those funds are unavailable until June 30, 2020.

 

The Trump administration has continually used the CCC to compensate farmers with tens of billions of dollars, especially after it was badly affected by the US-China trade war.

 

-      Reuters