The USDA is increasing the amount of funding available for the Spot Market Hog Pandemic Program and expects to issue approximately $62.8 million in pandemic assistance payments to hog producers starting this week. SMHPP assists eligible producers who sold hogs through a spot market sale from April 16, 2020, through Sept. 1, 2020. USDA's Farm Service Agency accepted SMHPP applications through April 29, 2022. 

"In order to provide more targeted support to hog producers affected by the pandemic, FSA was able to increase funding for SMHPP to provide full payments to producers instead of applying a payment factor," says FSA Administrator Zach Ducheneaux. "We are pleased to be able to provide more equitable opportunities for hog producers who were hard-hit by the pandemic."

SMHPP payments will be calculated by multiplying the number of head of eligible hogs, not to exceed 10,000 head, by the payment rate of $54 per head.

FSA originally planned to apply a payment factor if calculated payments exceeded the allocated $50 million in pandemic assistance funds for SMHPP. Payments are not expected to be factored due to Agriculture Secretary Tom Vilsack's decision to increase funding enabling producers to receive 100% of the calculated SMHPP payment.    

"We appreciate FSA's commitment to providing assistance to those pork producers hit hard by the economic disruptions caused by the pandemic," says Terry Wolters, NPPC president and owner of Stoney Creek Farms in Pipestone, Minnesota. "Producers forced into spot market hog sales are still challenged by the market disruptions of COVID-19, and these funds will contribute to the ongoing recovery of the U.S. pork industry."

There is no per person or legal entity payment limitation on SMHPP payments.

USDA offered SMHPP in response to a reduction in packer production due to the COVID-19 pandemic, which resulted in fewer negotiated hogs being procured and subsequent lower market prices. The program is part of USDA's broader Pandemic Assistance for Producers initiative and addresses gaps in previous assistance for hog producers.