The 2018 Farm Bill, signed into law in December of 2018, expired on September 30, 2023. An extension at the tail end of last year shifted that expiration date to September 30, 2024. The current situation in farm country looks vastly different than it did in 2018, and the conditions for a farm financial crisis are brewing on the horizon.
Key agriculture groups have repeatedly sounded the alarm, making clear the untenable situation that many are facing after years of rising input prices, declining commodity prices, and natural disasters. Yet, some lawmakers still say that they feel there is not enough time to pass a new bill by the end of the year.
Here at Farm Policy Facts, we deal in facts. And the fact is that farm country can’t wait. We need a Farm Bill NOW.
Why? Let’s start with the fact that farmers are facing skyrocketing input prices and plummeting crop prices, and – as a result – are quickly depleting their liquidity and working capital.
This situation will likely have dire consequences, as Dr. Dana Allen-Tully, President of the Minnesota Corn Growers Association, told the House Agriculture Committee on July 23: “I don’t want to be discouraging this morning, but it’s important to provide a glimpse at today’s economic picture for agriculture. Unless conditions change, we’re facing a perfect storm, though I don’t think it will be fully understood until early next year, when farmers are unable to secure loans because they can’t cashflow.”
There’s a lot at stake, which is why we’ve compiled the top 10 reasons we feel a Farm Bill must be passed this year.
1 – The Farm Bill is already past due. Did you know that the 2018 Farm Bill expired on September 30, 2023?
The current farm safety net is woefully outdated and has not seen a significant investment – except by ad hoc measures enacted by Congress or unilaterally implemented by the Secretary of Agriculture – in over two decades. A strong Farm Bill is absolutely necessary to ensure our nation’s hardworking farm and ranch families are able to cash flow and secure loans to continue to operate.
2 – Interest rates are at a 23-year high. Did you know that farm interest expenses are the fastest growing production expense for producers, hitting nearly $35 billion in 2023? That’s a nearly $10 billion increase over the year before.
While all Americans have felt the squeeze of higher interest rates and rising inflation, America’s farm and ranch families have been hit the hardest; many producers will borrow more capital in one year than most Americans will in their entire lifetime. Our producers need the certainty of a 5-year Farm Bill in this volatile time, including a robust safety net under the commodity and crop insurance titles.
3 – The farm economy is in dire straits. Did you know that over 50 percent of agricultural economists believe the U.S. agriculture economy is already in a recession?
Farmer sentiment plummeted in August as producers expressed concerns over weakening farm income prospects, largely citing declining crop prices despite an expected strong fall harvest for many crops. Part of this is due to the lack of action on a strong, new Farm Bill – or effective ad hoc assistance since 2021. Total farm sector debt is projected to reach its highest level since at least 1970. Rural America depends on a vibrant, growing farm economy. A Farm Bill that invests in critical infrastructure for our rural communities is past due.
4 – Farmers are facing a record decline in net farm income. Did you know that net farm income has declined by over 23 percent since 2022?
Net farm income, a broad measure of earnings by USDA, is projected to fall to $140 billion in 2024, an $42 billion collapse since 2022. America’s farm and ranch families are facing increasing input costs, rising interest rates, natural disasters, declining crop prices, and more. The next Farm Bill must provide a strengthened safety net for the producers who feed, fuel, and clothe the nation and much of the world and who are reeling from this record decline.
5 – The agricultural trade deficit is at a record level – and growing. Did you know that the agricultural trade deficit is projected to reach a staggering $42.5 billion in FY 2025?
Agriculture has historically contributed a trade surplus – but in recent years has faced a growing deficit. A robust trade agenda is needed to support growing market access for America’s farm and ranch families. Approximately 20 percent of U.S. agricultural production is exported to foreign markets. By funding programs such as the Foreign Market Development program and Market Access Program, the Farm Bill helps producers promote their products and expand market access abroad. Farm Bill proposals, including the Farm, Food, and National Security Act of 2024, would double the funding for both of these crucial programs.
6 – A growing global population demands a robust agriculture sector. Did you know that the global population is expected to reach 10 billion by 2050 and we will need new arable land the size of India to feed everyone unless producers can produce more with less?
America’s farmers and ranchers are the best in the world at what they do and are consistently looking for ways to do more with less. According to USDA, total farm output nearly tripled between 1948 and 2021 even as the amount of land, labor, and other inputs used in farming declined. Technological advancements and investment in agricultural research encourages on-farm innovation – in fact, for every dollar invested in agricultural research, there is a return on investment of $20. However, we are still facing unprecedented rates of hunger. If producers are to continue producing more with less to feed this growing population, the Farm Bill must invest in enhanced agricultural research programs and provide a background of support for the innovative producers who pioneer new technologies.
7 – America’s farm and ranch families – and those who work in agriculture – need a strong Farm Bill. Did you know that 10.4 percent of U.S. employment can be attributed to agriculture, food, and related sectors?
According to USDA, 22.1 million full and part-time jobs were related to the agricultural and food sectors in 2022. Those who work in agriculture are part of the critical infrastructure that is relied upon daily to feed America while supporting millions of jobs across the country. Even in times of uncertainty, America’s farm and ranch families roll up their sleeves to get the job done. We owe it to these hardworking men and women to get a strong Farm Bill across the finish line.
8 – The agriculture sector is a key contributor to the U.S. economy. Did you know that agriculture, food, and related sectors made up nearly 6 percent of the U.S. GDP in 2023?
The U.S. agriculture sector is responsible for nearly 6 percent of the U.S. Gross Domestic Product (GDP). Food security is national security, and our agriculture sector is essential to a strong economy. Americans spend less of their disposable income on food than any other nation. The farm safety net, which accounts for less than ¼ of 1 percent of the federal budget, provides a backing of support for these incredibly efficient and productive farm and ranch families. Strengthening the farm safety net ensures that the agriculture sector can maintain its status as a key contributor to the U.S. economy.
9 – The average age of farmers is increasing, and we need to attract a new generation of those who will grow our crops, raise livestock, and take care of the land and soil. Did you know that the average age of the farmer is over 58 years old?
The 2022 Census of Agriculture confirmed that the average age of the farmer is increasing. The number of producers aged 35-64 declined by 9 percent from 2017 to 2022, while the number of producers over the age of 65 increased by 12 percent. Young and beginning farmers and ranchers face steep barriers to entry, including limited access to land, capital, and an increasingly complex regulatory burden. The next Farm Bill must support the next generation of farmers by ensuring access to a strong safety net, including a strong commodity title, ample credit, crop insurance, and other key tools.
10 – Farming and ranching isn’t just a job – it’s a way of life. Did you know that 97% of farms are family owned and operated?
Farm and ranch families and rural communities represent the best of America. These families are innovators, entrepreneurs, and stewards of the land; and they play a key role in continuing the great story of American agriculture. A strong Farm Bill with a meaningful farm safety net ensures that the next generation will have the opportunity to keep the tradition going.
When it comes to the federal budget, there is no better investment than smart farm policy. We encourage you to share this information with your networks and on social media to help get the message out that we need a Farm Bill NOW!