April 20, 2020

US President Donald Trump announces US$19 billion aid for farmers affected by COVID-19

The relief programme includes US$16 billion direct payments towards producers and large purchases of domestic meat, dairy and vegetables, reported Reuters.

The US Agriculture Department (USDA) will work with regional and local distributors to buy US$3 billion in agriculture products to be channeled to food banks, churches and aid groups. Many Americans have lost their jobs due to COVID-19 affecting the economy.

In addition, the USDA will make US$100 million total purchases of dairy, meat and fresh produce, working together with companies such as Sysco Corp to obtain, package and distribute food.

US farmers and producers have been forced to dispose of additional food because of COVID-19 related disruptions.

Agriculture Secretary Sonny Perdue said direct payments will be channeled as soon as end May as agriculture commodity producers continue to suffer losses. 

U.S. Senator John Hoeven of North Dakota, chairman of the Senate Agriculture Appropriations Committee said from the US$16 billion, US$5.1 billion will be channeled towards the cattle industry, $2.9 billion for dairy and $1.6 billion for swine. US$3.9 billion will go towards row crop producers, US$2.1 billion to specialty crop farmers and a further US$500 million to other crops. There is a US$250,000 maximum cap for each individual farmer or entity.

The Renewable Fuels Association (RFA) criticised the USDA announcement. The RFA, which represents corn-based ethanol producers, is also affected by decreased demand due to economic conditions caused by COVID-19. 

Purdue said the USDA will cover both small and large farmers and affirms that some areas might consider payments to be insufficient.

He added that aid funding will come from various sources, which includes COVID-19 related laws passed by Congress and other funding that can be tapped by USDA. He said additional funds may be required.

-      Reuters