The legislation, introduced in Congress on Friday, would authorize USDA to make a one-time economic disaster payment of $2.42 per hundredweight to Louisiana rice producers. The payment would be based on actual 2002 production.
“During our travels in Louisiana during August, rice industry leaders and dozens of rice farmers told us they are suffering from the lowest prices in more than 50 years,” the senators said. “According to information we’ve received, current 2002 levels of farm program and market income are approximately $2.42 per hundredweight bellow 1998-2001 levels.”
The combined farm program support from the new farm bill’s direct and maximum counter-cyclical payments is 98 cents per hundredweight below the average support during 1998-2001, according to the senators, both Democrats.
“We’re told that given the historically low market prices, the 2002 farm bill will not be able to provide many of our rice farmers with sufficient support to help them stay in business any longer,” the senators said in a letter to President Bush in early September. “Our rice farmers need economic relief soon.”
The senators’ action came after the USA Rice Federation’s board of directors voted to support an effort by the Louisiana Rice Producers’ Group to obtain emergency economic assistance on the condition that the 2002 farm bill was not opened up for amendment. The Rice Millers Association also agreed to support the effort.
“Louisiana has had the full backing of the USA Rice Federation, with the U.S. Rice Producers’ Group and the Rice Millers’ Association supporting our push to obtain emergency economic assistance, which we appreciate,” said Paul “Jackie” Loewer Jr., chairman of the Louisiana Rice Producers’ Group, which asked the senators to introduce the legislation.
“USA Rice staff and our producer leadership in Louisiana worked with the staffs of Sen. Breaux and Sen. Landrieu on drafting the legislation. Our Louisiana congressional delegation is working hard on our behalf, and we appreciate all their efforts.”
Loewer said Louisiana rice producers are suffering historic low prices that threaten not only the stability of the state’s rice industry, but also the economic viability of businesses and rural communities that depend on rice production.
Louisiana rice farmers, who have completed their harvest, say they are being hammered by a combination of low market prices (prices have fallen to less than $4 per barrel in southwest Louisiana or $2.50 per hundredweight) and changes in the payment schedule and the base and yield provisions of the new farm bill.
Because of the way it was passed, payments under the new farm bill will actually be made over two crop seasons, and this farm bill’s direct payment is lower than the fixed payment under the 1996 law, farmers note.
“Why would you string out payments over a two-year period when you can only borrow for 12 months?” asks Ken Roberts, a rice producer from Kinder, La. “Without these payments falling in the same crop year, like they have in the past, farmers know they cannot cash flow.”
“A farmers’ loan will not be paid off for 2002, and he has no funds to pay his cash rent in January, 2003,” said Jan Roberts of Kinder. “What happens to the fertilizer dealer, the parts house, equipment dealers, aerial applicators, truck drivers and others? Can you imagine the economic impact this will have on small rural towns?”