By MATTHEW D. ERNST
WASHINGTON, D.C. — Indiana’s U.S. senators are cosponsoring legislation to nationalize a pilot program that has allowed Midwest farmers to use crop program acres to grow fruit and vegetable crops under contract for processing.
“The legislation is designed to expand Farm Flex to all states and all acres,” said Sen. Joe Donnelly, a Democrat.
The Farming Flexibility Act of 2013, cosponsored by Donnelly and Republican Sen. Dan Coats, would allow producers to opt out of federal crop program restrictions for producing non-program fruit and vegetable crops on farm program acres. A similar bill has been introduced in the House.
Under the 2002 farm bill, unauthorized production of fruits and vegetables on program acres could have resulted in the loss of program payments on all the producer’s acres. The 2008 version instituted a pilot Farm Flex program on up to 75,000 acres across seven Midwest states, including 9,000 acres in Indiana.
Farm Flex – introduced by Donnelly, who was a House Congressman at the time – allowed farmers to grow fruits and vegetables under contract for processing, without penalty, on farm program acres. The pilot Farm Flex program came as Midwest vegetable processors found it harder to recruit growers, said Nick George, president of the Midwestern Food Processors Assoc.
“There was the potential for growers to lose their program acreage history if they grew specialty crops,” said George; Farm Flex eliminates that possibility. “Producers who grow program crops are able to opt out to grow processed vegetables and then opt back in (the) next year without penalties. The pilot acres have proven very helpful to keep processing acreage up.”
Donnelly emphasized the Farm Flex program only applies to vegetable crops grown under contract for processing, not fresh acres. “This legislation protects fresh (fruit and vegetable) growers,” he said. “Fresh growers have been concerned about competition from these acres, so the only acres that are available (under Farm Flex) are ones that are used for processing. It’s a win-win.”
A short 2011 report prepared by the USDA’s Economic Research Service and Farm Service Agency indicated Farm Flex acres had no effect on fresh production in 2009. The report stated Farm Flex “entices a very modest increase in processing vegetable production and a very modest decline in processing vegetable prices.
“The quantity of processing vegetables supplied increases between 0.1 and 0.6 percent, and prices decline by 0.3 to 2.8 percent. We do not find that PTPP has an impact on fresh fruit and vegetable markets.”
Donnelly said making the program permanent, and extending it to all program acres, will be good for Indiana. “It ends the 9,000-acre limitation for Indiana. It (would) enable us to grow more tomatoes, grow more pickles, grow more green beans,” he said. “And, it allows our farmers to farm on a free market basis, where they can pick the crops they want and grow the crops they want, and their success is on their shoulders.”
A statement issued by Coats also commended the bill’s market-based approach: “The Farm Flex plan is a successful, tested, market-based program that has proven to save taxpayer dollars. By expanding this program nationwide and making it permanent, we can empower crop producers and farmers to have more control over their businesses without the government playing an unnecessary role in agriculture.”
Instituting a permanent Farm Flex program could potentially streamline the program’s paperwork. “This bill makes the program permanent. It is something we’ll be able to count on year after year,” said Donnelly. He said he welcomes input from Indiana producers about how the administration of the program might be improved in any way over the pilot program.
“Our goal is to make (the Farm Flex program) as simple as possible, and any suggestions that producers have for us, we’d be happy to incorporate.”
He said the bill’s potential passage would follow the timeline of the farm bill. “We’re hoping to have a farm bill over to the House in June or July and that we have a bill completed by both the House and the Senate and agreed to in conference committee before September is done,” he said.