In recent news, the Trump administration stated that a $6 billion bailout has been planned for farmers who have become collateral damage in the current “trade wars” between the U.S. and certain other countries. The U.S. Department of Agriculture said that of the $6 billion payments to begin September 4, 2018, under the Market Facilitation Program, aid of roughly $4.7 billion will be dedicated to agricultural producers of certain commodities that have been targeted by these other countries in retaliation of tariffs that the U.S. placed on steel, aluminum, and technological imports. These commodities include soybeans, corn, cotton, dairy, hog, sorghum, and wheat. The remainder of the $6 billion will be in the form of federal government purchases of other agricultural commodities, and costs related to developing new foreign markets for agricultural products.
The Market Facilitation Program (MFP) was established under the Commodity Credit Corporation (CCC). The program considers various factors such as the severity of the trade disruption and the length of time needed to adjust to new trade patterns to determine the applicable payment rate to use for producers who offer any of the commodities mentioned above. Initial MFP payments will be calculated by multiplying the previously determined rate by 50 percent of the producer’s total 2018 production. If the CCC declares that a second MFP payment will be made, then the remaining 50 percent of the producer’s output will be multiplied by a newly determined rate and additional funds will be designated accordingly.
The following chart illustrates the initial payment rates for the given commodities.
| Commodity | Initial Payment Rate | Estimated Total Initial Payment |
| Cotton | $0.06 / lb. | $276,900 |
| Corn | $0.01 / bu. | $96,000 |
| Dairy (milk) | $0.12 / cwt. | $127,400 |
| Pork (hogs) | $8.00 / head | $290,300 |
| Soybeans | $1.65 / bu. | $3,629,700 |
| Sorghum | $0.86 / bu. | $156,800 |
| Wheat | $0.14 / bu. | $119,200 |
| Total | $4,696,300 |
So, who will qualify to receive assistance from this program? Payments will be limited to eligible applicants who are actively engaged in farming and have adjusted gross income of less than $900,000 for the tax years 2014-2016. Total payment amounts will not exceed $125,000 per individual or legal entity.
Individuals or entities who may qualify for this program can apply after their current harvest is 100 percent complete and they can accurately report their total 2018 production. Applications are currently available online at www.farmers.gov/mfp along with other information. The applications can be submitted online, in person, or by email, fax, or mail.
Yeo & Yeo’s Agribusiness Services Group will continue to monitor the tariff battles. We are watching the opportunities available for farmers to offset market declines. If you have questions, reach out to your Yeo & Yeo advisor or me.
