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Farm Bill Deal Reached

Farm Bill Deal Reached

Key leaders have agreed to a move that would extend the 2008 Farm Bill for another year.

As the year winds down and Congress appears unable to reach an agreement on the Fiscal Cliff, rising worries over an expired farm bill has apparently gotten come action. Over the weekend, key leaders of both parties on the House and Senate Agriculture Committees have agreed to a one-year extension of the 2008 Farm Bill, according to USA Today.

HARD AT WORK: House and Senate Ag Leadership have come up with a farm bill extension, which could pass before the 'Dairy Cliff' arrives.

In the end, it was worries about $8 milk - a possibility raised by some economists and others - that may have moved lawmakers to head for an extension. With the farm bill expiring today, the 1949 farm bill would go into effect. That would require USDA to support the price of milk at a price above $38 a hundredweight - much higher than the current $18 price. And in recent press briefings, Secretary of Agriculture Tom Vilsack indicated his department would do what it had to under the law.

Wire reports note that the vote on the extension - which would preserve the current bill until October - was to have occurred Sunday night. However, there are reports that Speaker of the House John Boehner has not decided how he will move on the measure. Boehner, a long-time opponent of the farm bill, didn't move the House-approved version of the 2012 farm bill to the floor for a vote last September after the House Ag Committee passed its version. A check of the vote calendars for both the House and Senate show no action was taken on the extension so far, but the House is back in session at 9 a.m. today.

Bloomberg reports "three farm-related bills were filed Saturday in the House of Representatives; all of them would stave off the potential jump in consumer milk prices should government commodity programs begin to lapse Jan. 1. One would extend current law, along with disaster aid for producers affected by this year’s U.S. drought and changes to current milk policy. The second measure is a shorter-term extension, and the third would protect only against possible dairy-price spikes."

Final details on the extension remain unclear. It may just carry forth with the current bill, or may have some new provisions as well. We'll update you as soon as we get more information.

An extension of the current bill was a move that many on the House and Senate Ag Committees had hoped to avoid. The Senate version of the 2012 Farm Bill passed through that chamber in June while the House version has languished after being passed in committee. There's a difference over nutrition program spending with the Senate cutting about $4.5 billion from the Supplemental Nutrition Assistance Program over 10 years, but the House proposing cuts above $10 billion over the same period.

The House measure also includes a new dairy assistance program that would include supply/production controls for dairies that take part. That part of the House measure was also an issue for some in the House. However, in comments earlier this year over the farm bill, Bob Stallman, president of the American Farm Bureau Federation, notes that the two measure were more alike than different and that those differences could have been worked out in committee had the House passed its version.

In fact, both versions would have ended direct payments to farmers and offered savings as high as $33 billion over a 10-year period (House version). Language of the current extension is not clear,

The extension gives the new Congress a chance to craft a 2013 Farm Bill, but with Fiscal Cliff issues top of mind, the farm bill will probably have to wait.

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