Despite ongoing efforts to encourage the passage of a new or extended farm bill by many in the agriculture sector, including Edge board members and staff, the current 2018 farm bill is expiring at midnight tonight (September 30, 2024). Below are some important implications of the farm bill expiration that may impact your farm.
There are two principal expiration dates for the majority of farm bill programs. The first is September 30, 2024, the end of the fiscal year and the second is December 31, 2024, the end of the crop year. These dates are important in determining which programs are impacted by today’s expiration.
Funding is another important criteria, some programs have mandatory funding or authorization provided by the farm bill. For provisions that expire at the end of FY2024, authority to operate may cease. The Dairy Forward Pricing Program is one program that will be impacted. Dairy farmers and private processors may no longer enter into new forward price contract agreements after September 30, 2024 or until an extension of the 2018 farm bill or a new farm bill is passed.
Farm commodity support programs, like the Dairy Margin Coverage program, are authorized based on crop years (i.e. calendar year during which a crop is harvested). The 2018 farm bill, as extended, authorized farm commodity programs through the 2024 crop year. The first commodity in 2025 to be impacted will be dairy because it will be the first crop “harvested” in the new year.
The consequences for the dairy support programs that expire on January 1, 2025, mean a reversion to outdated law, commonly called “permanent law.” Permanent law for dairy means using parity pricing requiring USDA to support dairy by 75-90% parity. USDA would be required to purchase manufactured dairy products such as nonfat dry milk, cheddar cheese and butter in order to raise consumer demand and increase the farm price of milk to appropriate support levels. The Secretary of Agriculture does have the ability to intervene by refusing to implement permanent law. USDA Secretary Vilsack did use this authority briefly in 2014 during the Obama Administration to prevent the reversion to permanent law.
Passage of the Inflation Reduction Act of 2022 established a longer timeframe for some programs and their funding within the conservation title. Programs such as the Conservation Stewardship Program (CSP), Environmental Quality Incentives Program (EQIP), Agriculture Conservation Easement Program (ACEP) and Regional Conservation Program (RCPP) will all remain largely unaffected by the expiration of the 2018 farm bill extension. The Conservation Reserve Program (CRP) was not included in the Inflation Reduction Act of 2022 and therefore the authorization and funding to enter into new contracts for this program expire on September 30, 2024.
Some programs, such as crop insurance, are permanently authorized, so they do not expire, and will not be affected by the farm bill expiration.
Other programs such as the Dairy Indemnity Payment Program (DIPP) and the Dairy Business Innovation Initiatives (DBI) have been funded through the annual appropriations process and are not impacted by the 2018 farm bill extension expiration.
If you would like more details about Edge's previous advocacy efforts, you can visit voiceofmilk.com. We are committed to keeping all members informed as this matter continues to develop and will provide further updates as they become available.
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