Blog | November 2, 2009

25,000 Citizens urge USDA to end lending to factory farms

JenMore than 25,000 citizens—including nearly 6,000 Farm Aid supporters—have called on the USDA to suspend loans for specialized pork and poultry facilities. The Campaign for Family Farms and the Environment (CFFE), a coalition of farm organizations that have been working since 1995 on issues relating to factory farms, coordinated the campaign and sent the petitions to Secretary of Agriculture Tom Vilsack last week. The petition asks the USDA to discontinue loans to new and expanding facilities that are contributing to hog and poultry overproduction.

Overproduction has driven the price of pork and poultry down, forcing family farmers out of business. In twenty of the last twenty-two months, for example, pork farmers have received prices below their cost of production. And while taxpayer money has fueled this overproduction, at the same time taxpayers are funding USDA bailouts that seek to decrease the oversupply. So the government is on the one hand funding this problem and on the other funding the solution to the problem it has created.

According to USDA data, USDA’s Farm Service Agency (FSA) made direct and guaranteed loans to build and expand hog and poultry facilities in the amount of nearly $265 million in 2008 and 2009. In 2009, the USDA has purchased $55 million of surplus pork and $42 million worth of surplus chicken in an effort to provide assistance to these markets. Another $100 million buyout has been proposed, and has the support of more than 100 members of Congress, according to Matt Ohllof of Iowa Citizens for Community Improvement.

According to Rhonda Perry, a grain and livestock farmer and program director of Missouri Rural Crisis Center, “This cycle of promoting the expansion of corporate livestock production with taxpayer money, then bailing out the industry because of overproduction with taxpayer money is an irresponsible practice and must come to an end.”

In fact, CFFE’s request is not without precedent. In 1999 the USDA issued a directive suspending all direct and guaranteed loan financing for the construction of specialized hog facilities, citing concerns that FSA loans could deepen the crisis of oversupply and low prices that were affecting the hog industry at the time. The USDA was quoted in the January 1999 Federal Register as saying, “It is inconsistent with USDA policies for FSA to continue to finance construction of additional production facilities… while other agencies within USDA expend resources to ameliorate over-supply conditions.”

That same common sense applies today. And, as Rhonda points out, the money saved by not funding expansion in the first place and then not bailing out the surplus in the second-place, could be used to help family farmers produce sustainably—in ways that make sense for the market, for the environment, and for all of us.

To date, the USDA has not responded to CFFE’s demand, but they keep pushing. We’ll keep you informed.

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