Farmers and ranchers routinely manage through the risks and uncertainties of weather and production on a daily basis. Using crop and livestock insurance and enrolling in federal farm programs can help manage the risks and avoid the financial downturns of either production or market shifts.
However, when major disasters strike, the regular safety net tools and decisions may not stretch far enough. Widespread drought, storms, wildfires and other disasters can all result in devastating agricultural losses. A wide portfolio of federal disaster assistance programs can help producers recover from and manage through losses.
In May, the University of Nebraska-Lincoln Center for Agricultural Profitability hosted a webinar featuring experts and programs from USDA’s Farm Service Agency and Natural Resources Conservation Service to help producers manage through disasters, particularly the recent drought across the Great Plains.
A recording of the webinar is available at go.unl.edu. A discussion of the programs and details provides a good overview of the assistance available to producers.
Farm Service Agency
FSA’s disaster assistance portfolio includes a broad mix of programs authorized in legislation, as well as a somewhat regular package of ad hoc emergency assistance approved from time to time.
After frequent, but irregular rounds of agricultural disaster assistance throughout the early 2000s, permanent standing disaster assistance programs were first included in formal farm bill legislation in 2008.
Four of the five programs from 2008 were reauthorized in the 2014 Farm Bill, with permanent authority and funding that continues today. Those four programs include the Livestock Forage Disaster Program (LFP); the Livestock Indemnity Program (LIP); Emergency Assistance for Livestock, Honeybees and Farm-Raised Fish (ELAP); and the Tree Assistance Program (TAP).
Here is an overview of the programs:
LFP. LFP provides payments to eligible livestock producers in a qualifying county who have suffered grazing losses due to drought or fire. The U.S. Drought Monitor (droughtmonitor.unl.edu) is used to determine eligibility for LFP. Payments are based on 60% of a monthly calculated feed cost for covered livestock, multiplied by one to five months depending on the intensity and duration of drought during the normal grazing season.
LIP. LIP covers abnormally high livestock death losses because of specific disaster events, including weather and disease. Eligible producers are paid at a rate of 75% of the market value of the affected livestock as of the day before the date of death.
ELAP. ELAP provides assistance to eligible producers for a range of potential losses not covered by other disaster assistance programs. ELAP benefits include payments for additional costs because of covered disaster events. Current assistance related to drought helps cover water transportation costs, costs of above-normal feed transportation costs, costs of transporting livestock to feed and costs of additional feed purchases above normal (for honeybees).
TAP. TAP provides assistance to eligible orchardists and nursery tree growers. The assistance can help cover replanting or rehabilitation costs of trees, bushes and vines lost to natural disasters.
There are several other standing assistance programs and provisions implemented by FSA beyond the portfolio above.
The Emergency Loan program provides financing to eligible producers recovered from production and physical losses because of covered events and disaster designations.
The Disaster Set-Aside Program provides further financial relief to FSA direct loan borrowers who cannot make scheduled payments due to covered events and disaster designations.
The Emergency Conservation Program and the Emergency Forest Restoration Program help with damage caused by natural disasters. ECP, under drought conditions, may help with the cost of providing emergency water to livestock (but not feedlot animals) and to existing irrigation systems for orchards and vineyards.
Emergency haying and grazing of Conservation Reserve Program cover may help extend forage supplies under drought conditions. Based on the drought monitor status and determination of forage production losses in a county, emergency haying and grazing provisions can help extend forage supplies provided it can be done without long-term damage to the established CRP cover.
Managed haying and grazing is also available as a practice in CRP, and as component of the Grassland CRP. While emergency haying and grazing does not include any penalty to the CRP payment, managed haying and grazing or grassland provisions come with an impact on payment rates.
The Noninsured Crop Disaster Assistance Program provides protection from production losses for producers of non-insurable crops. NAP provides catastrophic levels of coverage for a basic application fee, or higher levels of coverage for an additional premium. Crops eligible for NAP include those for which a standard crop insurance policy is not available.
Beyond the standing assistance programs, there remain the irregular, but frequent ad hoc disaster assistance programs. Crop disaster assistance was the one of the five programs from 2008 not reauthorized in 2014, in part because of the sense at the time that crop insurance was widely available and utilized, negating the need for further assistance. However, there have been repeated calls for assistance since, and there have been several programs implemented over the past decade.
The Wildfires and Hurricanes Indemnity Program (WHIP) was implemented in 2018 to cover eligible crop losses from 2017. WHIP+ was later authorized to cover 2018 and 2019 crop losses because of additional hurricanes and other covered losses, including the storm and flooding losses of 2019 in the Midwest.
In both cases, assistance was available to crop producers suffering qualifying losses regardless of existing crop insurance participation. However, the payment factor rewarded producers that did buy insurance with a higher factor for higher insurance coverage levels, as well as a crop insurance purchase requirement for the next two crop years.
Phase 1 of the Emergency Livestock Relief Program was rolled out in 2022 to provide further payments to producers that had already received 2021 LFP payments. The additional payments are designed to address the increased feed costs above what the LFP program calculations had previously determined. Phase 2 is under review at FSA as of late May to assess 2021 losses and determine what additional payments or additional help for producers is needed.
Phase 1 of the Emergency Relief Program for crops was recently announced to cover qualifying crop losses from 2020 and 2021. ERP payments are tied to crop insurance or NAP purchases with a minimum purchase of catastrophic coverage and a rising payment factor for higher levels of coverage. Much like with ELRP, any Phase 2 ERP assistance remains under review at FSA as of late May.
Natural Resources Conservation Service
While FSA has a large portfolio of programs to provide disaster assistance and relief, NRCS has primary responsibility over a large portfolio of conservation programs that help incentivize and reward good conservation practices. These practices may help producers mitigate or even prevent some drought and other disaster losses by protecting resources or improving resilience.
NRCS does provide important functions related to disaster assistance, and provides some targeted assistance as needed. NRCS helps with assessment of disaster conditions, such as documentation of production losses, and also helps provide program and technical assistance for producers. There are some specific programs and provisions that do provide disaster relief or management incentives.
The Emergency Watershed Protection Program can provide financial and technical assistance to local sponsoring agencies to help repair damaged streams, drainage facilities, conservation practices, etc. With losses from floods, fires, windstorms or other natural disasters, EWP may help participants repair damage to the land, including establishing vegetative cover on drought- or fire-damaged land.
The Conservation Stewardship Program and the Environmental Quality Incentives Program are the two largest NRCS programs. They provide cost-share and stewardship incentives to producers for adoption and maintenance of conservation practices.
Various CSP and EQIP practices may help producers better manage their resources and improve their resilience against future disasters. EQIP also includes some disaster assistance practices that could help producers coping with drought or recovering from fire, including prescribed grazing and cover crops.
EQIP practices that can help producers manage drought include deferred grazing, livestock watering structures (pond, well, facility or pipeline), prescribed grazing and fencing, conservation tillage and crop rotation, increased-efficiency irrigation practices, and irrigated to dryland conversion.
Help through challenges
While good practices and assistance programs cannot prevent agricultural disasters from occurring, they may help producers manage through the challenges and prevent catastrophic losses, or provide relief from the losses that have occurred.
USDA is responsible for delivering a wide range of programs that can help producers both manage for and recover from disasters. Standing disaster assistance programs from FSA, along with recently announced ad hoc programs, will provide substantial financial assistance for recent losses.
NRCS programs also can provide some immediate relief, but are best positioned to help producers prepare for the future with conservation practices that improve their operation and build their resiliency against future weather and disaster challenges.
Lubben is the Extension policy specialist at the University of Nebraska-Lincoln.