Once the dust settles from the present impasse and battle over the federal budget deficit, the Fiscal Year 2012 budget is likely to contain a combination of spending cuts and revenue increases. “It will impact agriculture,” says Roger Bernard, Informa Economics, who spoke at Top Producer’s Summer Seminar in Bettendorf, Iowa.
USDA’s budget is likely to be cut, he says. But with 75% of the department’s $144 billion budget allocated to food, feed and nutrition that means farm programs will likely be on the chopping block, particularly since crop incomes are presently at high levels.
It’s impossible to know just when the farm bill will be passed. It’s not out of the question that budget cutting could force a farm bill to be written this year. “Because of the budget issue, the timeline could be affected.” Furthermore, it’s possible that the bill, on the House side, could be written on the House floor, he says. “Direct payments will be the low hanging fruit.” Crop insurance could also be a target. “A lot of people say it’s something to look at.”
He continues that it’s totally unclear how many dollars will be available for the next farm bill in light of Congress’s budget cutting mood. In addition, programs in the 2008 farm bill have not been funded, and some are pretty popular programs. “There is no baseline for them,” Bernard says.
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View PDFs of Bernard's and other speaker's presentations at the Top Producer’s Summer Seminar.