USDA announces Coronavirus Food Assistance Program for producers
The program will include a $3 billion purchase by USDA of dairy products, produce and meat.
On April 17, U.S. Secretary of Agriculture Sonny Perdue announced the Coronavirus Food Assistance Program (CFAP). This new USDA program will take several actions to assist farmers, ranchers and consumers in response to the COVID-19 national emergency. President Trump directed USDA to craft this $19 billion immediate relief program to provide critical support to our farmers and ranchers, maintain the integrity of our food supply chain, and ensure every American continues to receive and have access to the food they need, USDA said.
“During this time of national crisis, President Trump and USDA are standing with our farmers, ranchers and all citizens to make sure they are taken care of,” Perdue said. “This program will not only provide immediate relief for our farmers and ranchers, but it will also allow for the purchase and distribution of our agricultural abundance to help our fellow Americans in need.”
CFAP will use the funding and authorities provided in the Coronavirus Aid, Relief and Economic Security Act (CARES), the Families First Coronavirus Response Act (FFCRA) and other USDA existing authorities. The program includes two major elements to achieve these goals, USDA said, including:
- Direct support to farmers and ranchers: The program will provide $16 billion in direct support based on actual losses for agricultural producers where prices and market supply chains have been impacted and will assist producers with additional adjustment and marketing costs resulting from lost demand and short-term oversupply for the 2020 marketing year caused by COVID-19.
- USDA purchase and distribution: USDA will partner with regional and local distributors, whose workforce has been significantly impacted by the closure of many restaurants, hotels and other foodservice entities, to purchase $3 billion in fresh produce, dairy products and meat. The agency will begin with the procurement of an estimated $100 million per month in fresh fruits and vegetables, $100 million per month in a variety of dairy products and $100 million per month in meat products. The distributors and wholesalers will then provide a pre-approved box of fresh produce and dairy and meat products to food banks, community and faith-based organizations, and other nonprofits serving Americans in need.
On April 17, dairy association leaders were quick to react to the announcement.
“Today’s announcement by the White House and USDA — the Coronavirus Food Assistance Program — is an important first step that begins to bring much-needed relief to the U.S. dairy industry,” said Michael Dykes, D.V.M., president and CEO of the Washington, D.C.-based International Dairy Foods Association (IDFA). “With $16 billion in payments to producers and $3 billion for food purchases, including at least $100 million per month in U.S. government purchases of a wide array of dairy products, this is a robust good-faith effort to ensure the dairy supply chain remains intact.
“IDFA requested that USDA and the White House act with urgency to deliver an aggressive mix of direct financial support for producers as well as food purchases to offset growing food insecurity,” he continued. "The administration delivered with a creative approach on the product purchase side of this announcement.
IDFA is pleased to see USDA go beyond traditional programming to streamline the process and forge an important partnership with the private and nonprofit sectors to incorporate underutilized foodservice infrastructure — such as transportation and refrigerated storage — to quickly and efficiently get food to Americans in need. ... In the months ahead, IDFA will continue to work with policymakers to design policies and programs, such as lending and working capital programs, that preserve the dairy supply chain and ensure dairy remains an important part of feeding Americans in need," Dykes added.
Jim Mulhern, president and CEO of the Arlington, Va.-headquartered National Milk Producers federation (NMPF), the largest U.S. dairy-farmer organization, agreed that federal assistance for farmers is critically needed.
“The plan announced today should provide important relief to some producers, and we look forward to learning more of its details in coming days to fully understand its scope and implementation,” he said.
“Dairy’s fortunes have been especially grim, given the perishability of our product, its daily harvest and the fact that the virtual shutdown of the foodservice market has wiped out more than one-third of our product demand.
“After five years of poor prices, many producers faced financial difficulties even before the coronavirus crisis, Mulhern added. “Without more aid, this crisis could be their demise. We hope to work with USDA and members of Congress on implementing this plan and on the further assistance that will inevitably be needed due to this deepening crisis.”