By Max Fisher, Director of Economics and Government Relations
After Agriculture Secretary Sonny Perdue announced on Nov. 15 the second tranche of 2019 Market Facilitation Program (MFP) payments, USDA began issuing them this week.
The first tranche was issued in late summer and equaled the higher of either 50 percent of the total payment expected or $15 per acre. The second tranche will equal 25 percent of the total payment expected, and the third tranche – if implemented – will equal the remaining 25 percent and occur in January 2020. Producers in counties receiving the minimum $15 per acre MFP payment will not receive a second or third tranche.
As a reminder, all producers in a county will receive the same MFP rate for planted acres, regardless of their productivity. In addition, the MFP payment range is quite large – from $15 per acre to $150 per acre – so producers in some regions may be more pleased with the level of assistance than others. The wide payment range largely is attributable to USDA’s methodology for determining MFP crop rates, which exclusively relies on lost exports attributable to trade retaliation and ignores planting shifts that increase the supply of crops that allegedly are affected less by retaliatory tariffs (e.g., the major shift from soybeans to corn in 2019 that has depressed corn prices).
Producers who filed a prevented-planting claim and planted an FSA-certified cover crop qualify for a $15 per acre payment. Acres that were never planted in 2019 are not eligible for an MFP payment.
Producers who have signed up for the 2019 MFP automatically will receive the second tranche. Sign-up for 2019 MFP ends on Dec. 6, 2019.
For more information on MFP, visit www.farmers.gov/mfp.