By Judith Ruiz
Farmers in Wisconsin may be breathing a sigh of relief going into the new year with the farm bill extension but it may be temporary, as experts said there are issues with continuing the current legislation.
One of the biggest problems cited with the current Farm Bill is it was negotiated more than five years ago, so the crop reference prices are outdated.
Paul Mitchell, professor of agriculture and applied economics at the University of Wisconsin-Madison, explained the reference prices allow payments to farmers when a crop falls below a certain level.
"Prices have been declining on the corn and soybeans and the processes used to create this support in these times of thin, negative margins, they're out-of-date," Mitchell pointed out. "Those floors were set in 2018, and you know, we've gone through a lot of inflation and so, $1,000 isn't what it used to be."
Mitchell noted farm organizations have been asking Congress to increase crop reference prices and change the process to make it more relevant to current commodity markets. The Farm Bill was extended again for another year as part of a spending bill to avert a federal government shutdown.
Mitchell emphasized a lot of uncertainty looms with the incoming administration's goal to cut budget costs. There's also a new Secretary of Agriculture nominee, who would play a key role in renegotiating trade agreements which could involve imposing proposed tariffs.
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