U.S. Secretary of Agriculture Sonny Perdue on Monday announced details regarding a portion of the short-term, $12 billion aid package to offset some of the effects of retaliatory tariffs on American agricultural producers.
President Donald J. Trump directed Secretary Perdue several months ago to craft a short-term relief strategy to protect agricultural producers from unjustified retaliatory tariffs from foreign nations while the Trump Administration conducts ongoing trade negotiations. “Early on, the President instructed me,” Perdue said in a statement, “as Secretary of Agriculture, to make sure our farmers did not bear the brunt of unfair retaliatory tariffs. After careful analysis by our team at USDA, we have formulated our strategy to mitigate the trade damages sustained by our farmers.”
The package, which complies with U.S. WTO obligations, includes three programs.
USDA’s Farm Service Agency (FSA) will administer the Market Facilitation Program (MFP) to provide payments totaling $4.69 billion to corn, cotton, dairy, hog, sorghum, soybean and wheat producers starting September 4, 2018. This is the first payment period. The second payment period, if warranted, will be determined by USDA. For each commodity covered, the payment rate will be dependent on the severity of the trade disruption and the period of adjustment to new trade patterns, based on each producer’s actual production. Further details on payment calculation formulas can be found here.
USDA’s Agricultural Marketing Service (AMS) will administer a Food Purchase and Distribution Program to purchase up to $1.2 billion in commodities unfairly targeted by unjustified retaliation. USDA’s Food and Nutrition Service (FNS) will distribute these commodities through nutrition assistance programs such as The Emergency Food Assistance Program (TEFAP) and child nutrition programs. These procurements will be purchased in four phases and spread over several months; in some cases, purchases could extend into late 2019.
Through the Foreign Agricultural Service’s (FAS) Agricultural Trade Promotion Program (ATP), $200 million will be made available to develop foreign markets for U.S. agricultural products. The program will provide cost-share assistance to eligible U.S. organizations for activities such as consumer advertising, public relations, point-of-sale demonstrations, participation in trade fairs and exhibits, market research and technical assistance. Applications will be accepted through November 2, 2018 and funding will be allocated in early 2019.
USDA’s press release with further details can be found here.
