The farm safety net is crucial to help farmers and ranchers manage risk.

In a committee hearing held May 2, American Farm Bureau Federation (AFBF) President Zippy Duvall shared agriculture’s needs in the 2023 Farm Bill with the Senate Committee on Agriculture’s Subcommittee on Commodities, Risk Management, and Trade.

“There are certainly plenty of challenges for American agriculture. Beginning with losses experienced from the trade war with China, pandemic lockdowns, supply chain disruptions, and record-high input costs, farmers and ranchers have been facing unprecedented volatility in recent years,” American Farm Bureau Federation (AFBF) President Zippy Duvall told the lawmakers.

The 2018 Farm Bill is set to expire on Sept. 30. The legislation is reviewed every five years to provide the opportunity to update programs to remain relevant to current market and economic conditions. The bill addresses farm program payments, food policy, conservation initiatives, rural development and more.

“The farm bill is a critical tool for ensuring our nation’s food supply remains secure. No one buys insurance for the good times, and similarly, farm bill programs provide critical tools to help farmers and ranchers manage risk,” Duvall said. “Most farmers don’t have the luxury of setting the price for their products, as most other small business owners do. Farmers accept the market rate, which fluctuates significantly, making financial planning a challenge. Add the unpredictability of weather and you see how farmers face intense volatility. It’s a good thing most farmers see their livelihoods as a calling more than a job.”

It’s essential that farmers and ranchers have the tools they need to succeed, including support from good public policy and strong markets both domestically and abroad.

“Farm programs are written to provide a basic level of protection to help offset bad economic times and severe weather. The 2018 farm bill brought certainty to farm and ranch families through crop insurance, improved risk management programs and support for beginning farmers and ranchers, while also providing much-needed funding for trade development and ag research,” Duvall said. “Title I commodity programs are designed to be critically important for farmers in the event of a sudden decline in commodity prices or farm revenue.”

Current policies were developed in the 2014 Farm Bill using 2012 cost of production data.

But the combination of spiking input costs and outdated policy has rendered the commodity title ineffective, Duvall told lawmakers.

“Considering the four crops that represent the largest acreage in the U.S.: corn, soybeans, wheat, and cotton, the forecast season average farm price of each commodity would need to fall by roughly 23, 30, 21, and 52%, respectively in 2023 to trigger any support under current law,” he said. “If left unchanged, with challenging production costs, many producers would be bankrupt before Title I support provides assistance.”

An early expectation of revenue declines for 2023 will more than erase gains made during 2022, and farmers need comprehensive risk management options to continue sustainably providing a reliable and resilient U.S. food supply.

Volatile markets, the pandemic, the war in Ukraine and weather disasters all signal the need for a strong safety net.

“Weather and climate conditions will have strong impacts on the true outcome of this year’s price outlook. Record corn and soybean production in exporting countries like Brazil and Argentina are competition for U.S. crops overseas, particularly in the China market. Uncertainty related to Mexico’s commitment to ban GMO corn for human consumption and the ongoing Ukraine-Russia conflict remains.”

Duvall noted that farm bill spending for the 10-year budget window starting in fiscal year 2024 is projected to account for less than 2% of the entire federal budget. Broken down further, the farm safety net, which is commodity programs and crop insurance combined, is projected to account for only two-tenths of 1% of federal spending.

“In return for this investment, the farm bill supports the food and agriculture sectors, which in 2022 accounted for direct, indirect, and induced output of more than 43 million jobs, $2.3 trillion in wages, $718 billion in tax revenue, $183 billion in exports and $7.4 trillion in economic activity,” Duvall said.

The wide-ranging farm bill touches all Americans, not just those in rural areas.

“Farming is a difficult and risky business, yet critical to the well-being of our country. It’s often stated that food security is national security. Few pieces of legislation are more significant than the farm bill when it comes to ensuring our food system is secure,” Duvall said. “Farmers have America’s back. The farm bill is how our country has farmers’ backs. We urge Senators to recognize this significance as they consider updating and improving the farm bill.”

View Farm Bureau’s farm bill priorities.

View the entire hearing.

Read the AFBF written testimony.

For more information about the 2023 Farm Bill, visit fb.org/farmbill.