USDA offers billions in subsidies to counter tariffs

USDA offers billions in subsidies to counter tariffs

Farm Farm
LUBBOCK, Texas -

While the trade war continues between the U.S. and China, the President directed Secretary Perdue to provide short term help. To do that, the USDA authorized up to 12 billion in programs to assist farmers. 
 

Kody Bessent, with Plains Cotton Growers, says that specific figure will cancel out the 11-billion dollar hit farmers took on July 6th. He says that buys the administration time. 

"It provides our administration a leg up with negotiations as they continue to hammer out these agreements with China and other countries throughout the world," Bessent said. 

The USDA doesn't need the government's funding for this bailout, so it doesn't have to go through congress. Along with the direct subsidies, the government will use a food purchase and distribution program to start buying up surpluses of some commodities. Those will go to food banks and other nutrition programs. 

"Once producers finish up harvest, ideally they would be able to go into their farm service agency locally and turn in their production records. After that the USDA should have a mechanism to calculate production on a payment rate factor," Bessent said.  

The bailout fades the competitive disadvantage from China's tariff. The USDA will use it's trade promotion program to partner with private sector industries. 

"As we move forward it helps let the administration negotiate from a power of strength and that's important as we move forward as we develop open access markets and playing fields for our producers at home," Bessent said. 

Bessent says the timetable for the rule-making process for the bailout is Labor Day.

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