BLOOMINGTON, Ill. — A recently announced harvest-oriented charity relief to benefit the earthquake- and tsunami-stricken people of Japan will allow farmers to donate grain directly to their local elevators instead of cash.

The cash value for the grain on the day of its donation will be forwarded to the American Red Cross in the name of the farmer for use in Japan, according to Illinois Corn Marketing Board (ICMB) spokeswoman Tricia Braid. She said Illinois’ proximity to river trade routes to Japan gives producers an opportunity to help strengthen Illinois’ future trade relationship with Japan, while helping stabilize the Japanese economy through the tax-deductible gift of grain.

“Especially along the river system, there is a specific interest in the market in Japan, (because) Japan has identified growers and elevators in Illinois to source non-GMO (genetically modified) corn and soybeans,” said Braid. “Farmers and elevators are aware of Japan’s impact on our market, and we’re getting a good response from them.”

Grain elevator managers across Illinois are aware of the program and how it works, according to Grain & Feed Assoc. of Illinois (GFAI) president Jeff Adkisson. GFAI has joined with ICMB, the Illinois Soybean Assoc., Ill. Pork Producers Assoc., Illinois Department of Agriculture, Illinois Farm Bureau, U.S. Grains Council, USA Poultry and Eggs Export Council and the U.S. Meat Federation to promote the program within its membership.

While the damage wreaked upon coastal Japan and some inland areas in March was so extensive that its total cost to property still cannot be properly estimated, Nicolette Smith of Earth Times described what the Japanese people will be facing in coming years in rebuilding everything from infrastructure to agriculture:

“One of the U.S.’ greatest trade partnerships is under threat. Over the next few years, Japan will face a barrage of problems: not only will it have to cope with the fallout from agricultural crop damage (waterlogged fields mean fewer crops, fewer jobs and the added cost of agricultural regeneration plus the high-cost reliance on international imports), (but also) the national cost of supporting the architectural rebuild, the financial impact of low employment rates as business struggle to cope with damaged office buildings and failing systems and processes, not to mention the unmeasurable (sic) emotional cost,” Smith wrote.

Donating bushels in lieu of cash entitles producers to avoid myriad taxes assessed with charitable donations of cash, according to Jim Locher of the University of Illinois’ Department of Agriculture and Consumer Economics. In a paper posted on the U of I’s farmdocDAILY website, Locher wrote those donating bushels over greenbacks will not have to include the value of donated grain on IRS Schedule F, yet expenses related to the production of the grain stay on Schedule F in the year paid.

Further, Locher added there is not a charitable contribution deduction for donated grain because no income is recognized on the donation. Federal, state and self-employment taxes are not paid on the value of the donated grain, and producers’ yield records are unaffected by a gift of grain, preserving their baseline for years to come, according to Locher.

“As far as the (USDA Farm Services Agency) is concerned, you still get to report the production of that grain, so it doesn’t affect your farm yield averages or your bookkeeping from that standpoint,” explained Braid, who was quick to add she is not a farm economist.

Though largely an Illinois initiative, the inclusion of some national agricultural associations and organizations in the relief effort was based on the organizations’ previously established relationships with farmers, business owners and officials in Japan.

‘They were brought in on our request,” said Braid. “The best way for us to get in touch with people on the ground in Japan was to use the relationships we’ve established through the U.S. Grains Council (and others); these groups have consultants in-country in Japan.

“All of the organizations are happy to have the opportunity to work together again across commodity groups and with farmers to help bring much-needed relief to Japan.”

Interested producers should contact their local grain elevator manager before harvesting and ask if the elevator is participating in the ICMB’s Japanese disaster relief effort.