Application Process for USDA Direct Payments Begins May 26

Brian German Agri-Business, Funding

An announcement that was recently made by U.S. Secretary of Agriculture Sonny Perdue detailed how the direct payments will be made to farmers and ranchers affected by COVID-19.  The U.S. Department of Agriculture’s (USDA) Farm Service Agency (FSA) will begin processing applications for financial assistance on Tuesday, May 26. The payments are being made available through the Coronavirus Food Assistance Program (CFAP) which will provide up to $16 billion in financial support.

direct payments for CFAP

“We did the best job we could to figure out mechanisms to determine rates for producer losses that were consistent across all the agricultural commodities as much as we were able to,” USDA Chief Economist Robert Johansson said during a media call. “But it certainly will not rise to the level of the damages that we’re expecting to see for agricultural producers as a result of the coronavirus.”

Direct payments under CFAP will be provided to producers who have endured a five percent-or-greater decline in commodity prices due to COVID-19. A multitude of agricultural products will be eligible for the payment program and the formula for payment rates will be dependent on commodity type.  Payments are limited to a total of $250,000 per person or entity for all commodities combined.  Eighty percent of the payment amount will be issued upon approval of an application as USDA will continue monitoring the situation.

“We know going forward producers are going to continue to have adjustment costs and require assistance to deal with surplus production due to the fact that we’ve lost a lot of marketing outlets,” Johansson noted.

Eligible producers will apply through their local FSA office with all of the pertinent documentation and certification information.  Accommodations will be made to facilitate the application process while FSA offices are operating under modified conditions.  Applications will be accepted through Friday, August 28.  Information about the application process is being made available online by USDA.

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Brian German

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Ag News Director, AgNet West