September 22, 2006

Survey: Ag producers want next farm bill to address bioenergy

Agricultural producers want to see the next federal farm bill address renewable energy issues, but traditional concerns such as disaster relief and other "safety-net" provisions remain priorities, too, according to a new national survey.

The University of Nebraska-Lincoln conducted the survey of producers in 27 states in conjunction with the Illinois-based Farm Foundation. About 63,000 surveys were distributed, with more than 15,000 useable responses. The report, titled "The 2007 Farm Bill: U.S. Producer Preferences for Agricultural, Food and Public Policy," was unveiled in Washington, D.C. Sept. 13.

This report will contribute to the debate over the next farm bill, which will set the nation's ag policy for the next several years, said UNL agricultural economist Brad Lubben, who coordinated the survey. "This provides an opportunity to get real producers' input into the process," he said.

Lubben said producers identified three fundamental policy areas as key goals for the new farm bill: renewable energy, small and beginning farm and ranch opportunities and food security.

The latter two goals "have been argued for decades," Lubben noted, while the interest in bioenergy reflects recent explosive growth in that sector. Lubben coordinated a similar producer survey with the Farm Foundation five years ago before the current farm bill was written. He said the economic setting is significantly different now. In the four years preceding development of the last farm bill, farm income dropped significantly, leading to $28 billion in emergency assistance for farmers and calls for additional safety net programs in the 2002 legislation. This year, although farm income is projected to be down in 2006, the outlook is better than in the late 1990s. Coupled with political pressure from interest groups for program changes, "the emergent farm bill debate may be less about the size of the safety net and more about the shape of the safety net," the report predicts.

At the same time, federal budget deficit projections and potential trade negotiations or conflicts could force substantial cuts or shifts in farm program spending. The deficit already has led to some delays in commodity payments and cuts in projected conservation, rural development and research funding.

It's possible that bioenergy could spark some new federal spending.

"Otherwise, we're mostly going to be competing with each other" to fund existing ag programs, Lubben said. Among those existing programs, disaster assistance ranks as the highest priority in the survey -- a reflection, perhaps, of agricultural losses in the last year from disasters ranging from drought to hurricanes, Lubben said. Such assistance isn't even a formal part of the farm bill, but its popularity may be a recognition that "we know we have to regularly address disaster concerns, and we need permanent authority to deal with it."

Crop insurance programs also are near the top of the list of producer-supported programs. For commercial-scale producers, the other existing safety net programs of direct payments, counter-cyclical payments and marketing loans also were ranked highly. Lubben suggested this could drive the debate to focus on the role of the wider five-part safety net instead of just the traditional commodity programs. However, Lubben noted, not all producers have benefited equally from the safety net programs. In particular, small-scale producers likely saw more benefits from conservation programs and ranked working land conservation programs ahead of commodity programs and behind only disaster assistance.

"The survey results indicated all of the existing farm programs were supported by producers, but it is clear that there are preferences if program cuts and tradeoffs are necessary," Lubben said in summarizing producers' opinions.

Other findings in the survey:

• Farmers don't want to see commodity program payments eliminated or reduced, but expressed some support for increased targeting to smaller farms.
• Producers generally support the pursuit of free-trade agreements and would like to see trade opportunities expanded by eliminating unilateral trade sanctions on food products, such as those in place with Cuba.
• Producers strongly support country-of-origin labeling for some food products, preferring mandatory rules over voluntary guidelines.
• Producers support testing programs for BSE, although they prefer guidelines for voluntary testing by industry over government-mandated testing.
• Producers strongly support programs focused on conservation, favoring technical or financial assistance for a number of environmental goals, especially water conservation and soil erosion prevention. More than half the respondents said they'd prefer federal funding for conservation programs be provided to states in the form of block grants to allow states to design and implement local programs, rather than the current system of federal implementation.

"The farm bill debate tends to be more evolutionary than revolutionary." Lubben plans to have a breakdown of Nebraska producers' survey feedback next month.