Top 10 Ag Stories of 2024: No. 1

31-Dec-2024

09:00:00

Editor's Note: Each year DTN publishes our choices for the Top 10 ag news stories of the year as selected by DTN analysts, editors and reporters. This year, we've counted them down from Dec. 18 to Dec. 31. On Jan. 1, we will look at some of the runners-up for this year. Today, we announce the No. 1 story of 2024: Congress failed to pass a new farm bill, despite farm groups urging lawmakers to take action before the end of the year.

This is the second year in a row that DTN has selected the lack of a new farm bill as the top ag story of the year.

The House Agriculture Committee passed a new farm bill out of committee in May, but the bill stalled. Farm bill action was delayed throughout 2024, eventually leading Congress to pass an economic aid package for commodity farmers in one of the last actions by Congress before adjourning for the year.

Congress will have to start over to try to revise and update the 2018 farm bill.

OMAHA (DTN) -- Congress proved unable to find a bipartisan path to pass a farm bill in 2024, but the end result played out better for commodity farmers due to a needed injection of financial aid.

Without five years of new policies, Congress on Dec. 20 passed a one-year extension of the farm bill that also included $10 billion of economic aid for commodity crops. Spurred largely by Hurricane Helene, the year-end bill also includes another $20.78 billion to help farmers recover from two years of natural disasters.

Under the latest efforts, Congress will have until Sept. 30, 2025, to try again to pass a farm bill after two years of failing to agree.

Republicans who support farm programs vowed all year to "put more farm back into the farm bill," which became a mantra as they made their case. Still, there were other House Republicans not on the Agriculture Committee who opposed increasing reference prices and farm subsidies. The House farm bill passed the committee in May with four Democrats joining 29 Republicans to advance the bill and 21 Democrats rejecting it. The lack of House GOP consensus effectively shelved the legislation from getting a floor vote for the rest of the year.

The Senate never got that far. Sen. Debbie Stabenow, D-Mich., who retired from Congress rather than run for reelection in 2024, had argued it was too costly to raise reference prices. She wanted more investment in policies that improve crop insurance options for all farmers rather than raise prices only for farmers with commodity base acres.

"When you ask farmers the most important part of risk management for them, it's crop insurance," Stabenow told reporters last April.

Sen. John Boozman, R-Ark., now the incoming chairman of the Senate Agriculture Committee, said he believed it would be better to get a farm bill done in 2024 rather than wait.

"I would argue for farmers that we have as great a chance, an easier chance, of getting a farm bill done this year rather than next year," Boozman told reporters.

Stabenow didn't offer an actual bill until after the presidential election. With Republicans taking over the Senate and the White House, there would be no negotiations on a five-year bill in a lame-duck session.

Boozman led other Republicans to call for one year of economic aid to farmers instead. That eventually became the $10 billion in one-time economic aid to commodity growers.

A YEAR OF DEBATE AROUND CCC

Early in 2024, Agriculture Secretary Tom Vilsack floated the idea of Congress using the Commodity Credit Corp. (CCC) to find a way to raise reference prices for the next farm bill, noting that increasing reference prices can get "pretty pricey." A 10% bump in reference prices is projected to cost about $2 billion a year.

The CCC is a $30 billion fund used each year by the secretary specifically to help support commodity markets. CCC dollars already fund the Agricultural Risk Program and Price Loss Coverage (ARC and PLC) programs as well as the Conservation Reserve Program (CRP).

Republicans in Congress had another plan. After Vilsack used $3.1 billion to create the Partnership for Climate-Smart Commodities, GOP lawmakers started considering more plans to restrict the Agriculture secretary's control of the CCC, and then take the projected savings to fund their plan to increase reference prices.

The fund was used aggressively during the first Trump administration, which included $23 billion in Market Facilitation Program payments in 2018-19 because China stopped buying U.S. commodities during the trade war.

House Agriculture Committee Chairman Glenn "GT" Thompson, R-Pa., included language to cut off USDA from using CCC dollars without congressional approval. Thompson's staff maintained the move provided $53 billion over 10 years that would go to boost commodity programs and crop insurance.

THE IRA FIGHT

Stabenow won the battle to get $19.5 billion conservation funds in the Inflation Reduction Act (IRA), which Democrats passed in 2022 with zero Republican votes. To protect those remaining funds, Stabenow agreed with the idea of rolling those IRA dollars into the farm bill as long as the funds went toward practices that reduce greenhouse gas emissions or sequester carbon.

The House farm bill brought in the leftover funds from the IRA and kept those dollars strictly for conservation but also removed the climate-specific focus on those funds.

In the end, the unspent pot of money, about $14 billion or so, could be lost. Stabenow came up with a plan to roll those dollars into the farm-bill extension. The funds would increase the baseline for farm-bill conservation programs but also provide a one-time offset that allowed $10.7 billion to go to economic aid. House Speaker Mike Johnson, R-La., rejected that idea, saying his caucus would not support saving those IRA dollars. In an interview with DTN, Stabenow called the decision "political malpractice."

The GOP is expected to take away those IRA dollars when they pass their own budget reconciliation bill next year.

THRIFTY FOOD PLAN

A key budget move for the House version of the farm bill was to adjust or reverse engineer changes USDA made to the Thrifty Food Plan. USDA early in the Biden administration updated the cost estimate for determining a healthy diet for SNAP recipients. In the past, those USDA updates were always "budget neutral," but the Biden administration updates increased the future projected costs of SNAP by nearly $30 billion a year.

By forcing USDA to go back to a budget-neutral calculation, the House farm bill plan suddenly had money to move around. Thompson took an estimated $27 billion on the back end of cost projections and used it to help with his plan to boost farm programs, trade promotion and research funding.

The change would restrict how future administrations make changes to SNAP. That includes potentially restricting a "hard right future administration" from "arbitrarily coming in and cutting benefits," Thompson explained.

Still, Democrats overall rejected the plan. Rep. David Scott, D-Ga., then the committee's ranking member, was among those who criticized Thompson plan, calling it a "poison pill" for Democrats.

OTHER WISHES

Beyond higher reference prices, at least some commodity groups also want the next farm bill to update base acres. The National Corn Growers Association (NCGA) voted to keep pressing Congress for a mandatory update of base acres. The American Soybean Association (ASA) opted for a voluntary update. The National Association of Wheat Growers (NAWG) opposed any changes to base acres -- except allowing farmers who currently don't have base acres to enroll.

A mandatory update of base acres would actually save about $1.9 billion over 10 years.

The House farm bill offered a one-time opportunity to expand base acres by up to 30 million acres.

PROP 12 FIX -- MAYBE

As if the farm bill didn't have enough conflicts, the battle over states' rights versus open national commerce came into play. In dealing with the effects of California's Proposition 12, the House version of the farm bill included language that states and local governments cannot impose conditions on the production of livestock located out of state.

The National Pork Producers Council expressed frustration when that language was not included in the final farm-bill extension.

WHAT'S NEXT

A new Congress will return on Jan. 3, 2025. Just like last year, lawmakers will come back with a lot of unfinished business and will try to pass a budget for FY 2025, which began last October. Republicans will be looking to use the budget reconciliation mechanisms to pass their own immigration and energy bills, along with clawing back as much of the Inflation Reduction Act as politically possible.

Somewhere in the mix, the House and Senate Agriculture committees again will have to figure out how to pass a farm bill. Unless attitudes change, lawmakers will lose access to the IRA dollars for conservation. The incoming Trump administration also likely will not want Congress to handcuff the Agriculture secretary's access to the CCC funds. So, any increase in commodity programs will have to find budget offsets elsewhere.

Then there is Elon Musk and the Trump administration's drive to cut spending. The farm bill is a 10-year, $1.5 trillion spending bill. It's likely Musk and others will be weighing in to demand cuts.

Democrats will have new leaders on the Ag committees with a real "Land of 10,000 Lakes" vibe. Sen. Amy Klobuchar of Minnesota will take over as ranking member of the Senate Agriculture Committee. In the House, Rep. Angie Craig of Minnesota will be the ranking member for the Ag Committee as well.

See related stories:

-- "Congress Passes Disaster Aid, Short-Term Budget and Farm Bill Extension, Narrowly Avoids Shutdown,"

https://www.dtnpf.com/…

-- "House Plan Puts More 'Farm in the Farm Bill' But Widens Payment Disparities," https://www.dtnpf.com/…

Read what DTN Editor-in-Chief Greg D. Horstmeier has to say about this No. 1 story of the year in Editors' Notebook, " 2024's Biggest Stories: Here We Go Again," https://www.dtnpf.com/…

Want to hear more about our DTN list of the top 10 ag stories and more discussion about why we selected the farm bill as the top story? Check out the Reporter's Notebook video at https://www.dtnpf.com/…

DTN Headline News

Headlines

Magazine Sign-Up

Our Heritage - Winter 2024