U.S. government shutdown affects agriculture; current farm bill expires

congressAfter passing a continuing resolution back and forth between the two chambers, Congress failed to come to an agreement to keep the government open beyond the Sept. 30 end of the fiscal year.

The main point of contention was the Affordable Care Act, set to go into effect Oct. 1. The House’s continuing resolution would delay implementation for a year and repeal a tax that would fund the act—provisions the Senate rejected. The shutdown will last as long as it takes the House and Senate to agree on a continuing resolution measure.

A shutdown means all federal agencies must lay off non-essential personnel and close non-essential programs and offices.

The shutdown has had immediate impacts on some farmers and markets, according to Tony Banks, a commodity marketing specialist with Virginia Farm Bureau Federation.

“Many local U.S. Department of Agriculture offices that service farmers will be closed or have only essential staff,” Banks said. “USDA’s website also has gone dark. Farmers that rely on USDA for technical and financial assistance to install conservation practices may have to wait until after the shutdown, and farm loan processing will be on hold.

“Mandatory price reporting and analysis conducted by USDA will be postponed for commodities such as dairy and peanuts. The industry relies on these daily or weekly USDA price reports.”

In some cases, like that of the dairy industry, Banks said, an alternative price value will be used to calculate federal milk pricing formulas during the shutdown.

R.J. Karney, budget specialist with the American Farm Bureau Federation, said USDA meat and poultry inspectors will continue working, although they’ll have to wait to get paid. The Food and Drug Administration will continue high-risk recalls and investigations, but routine inspection activities will be suspended. Extension and rural development offices will be closed.

“If the shutdown continues over a longer period of time, there will be a lot more uncertainty for farmers and ranchers about what’s going to happen with the farm bill,” Karney said.

The current farm bill expired at midnight on Sept. 30 so there is no authority for funding the Market Access Program or the Foreign Market Development Program. There also will be no new enrollments in the Conservation Reserve Program and the Wetlands Reserve Program. The Senior Farmers’ Market Nutrition Program will be closed until a new farm bill or extension is passed.

The most significant ramifications of the farm bill expiration will not occur until aboutJan. 1, when USDA would be required to start taking steps under permanent law to increase prices for milk and some commodity prices.

Last weekend the House approved a bill that combines the earlier House-passed farm bill (H.R. 2642) and last week’s House-passed nutrition bill (H.R. 3102). The combined farm bill/nutrition bill will be sent to the Senate for approval and re-appointment of conferees, although the timing of progress is uncertain due to the government shutdown.

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