Market News & Headlines >> Second Round of "Trade Aid" Authorized
U.S. President Donald Trump said on Monday he has authorized the second round of payments from a $12 billion aid package for farmers harmed by trade retaliation from foreign nations.
"Today I am making good on my promise to defend our Farmers & Ranchers from unjustified trade retaliation by foreign nations. I have authorized Secretary Perdue to implement the 2nd round of Market Facilitation Payments," Trump said in a Twitter post.
USDA said shortly later in a news release that for farmers who have already applied for MFP payments, completed harvest, and certified their 2018 production, a second payment will be issued on the remaining 50% of the producer’s total production, multiplied by the MFP rate for the specific commodity.
The MFP rates as listed in Monday’s news release remained the same as for the first round of payments: $1.65 per bushel for soybeans; 1 cent per bushel for corn; 14 cents per bushel for wheat; 6 cents per pound for cotton; $8.00 per head for hogs; 86 cents per bushel for sorghum and 12 cents per hundredweight for dairy.
MFP payments are limited to a combined $125,000 for corn, cotton, sorghum, soybeans, and wheat capped per person or legal entity. MFP payments are also limited to a combined $125,000 for dairy and hog producers, USDA said. Applicants must also have an average adjusted gross income for tax years 2014, 2015, and 2016 of less than $900,000. Applicants must also comply with the provisions of the Highly Erodible Land and Wetland Conservation regulations.
USDA in July authorized up to $12 billion in aid for farmers and ranchers harmed by “trade damage from unjustified retaliation”. The package was designed primarily to mitigate damage to farmers from the U.S. trade war with China, but also in response to tariffs on U.S. agricultural goods levied by other nations in response to higher U.S. tariffs on imported steel and aluminum.
An announcement on the second round of payments had been expected in early December. Reuters News Service reported on Dec. 11, citing three unnamed sources, that the “trade aid” payments was being held up by the White House Office of Management and Budget due to concerns over the cost of the program and because the agency wanted to see if trade issues with China were resolved.