Agribusiness Alert: USDA Announces Details of Market Facilitation Program (MFP)

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Information summarized from the press release by the U.S. Department of Agriculture 

Beginning last Monday, July 29th, farmers can go to their local FSA offices and signup for the new Market Facilitation Program (MFP)

This is the second year for the program and so far, USDA has made about $8.59 billion in payments to producers who applied in 2018.

What This Means for You

These payments, made by the Farm Service Agency (FSA) under the authority of the Commodity Credit Corporation (CCC) Charter Act, are available to producers.  This assistance is based on a single county rate multiplied by a farm’s total plantings of MFP-eligible crops in aggregate in 2019. A producer’s total payment-eligible plantings cannot exceed total 2018 plantings and the rate for county payments are from $15-$150 per acre.  These rates depend on the impact of the unjustified trade retaliation in that county.  Acreage of non-specialty crops and cover crops must be planted by August 1, 2019, to be considered eligible for MFP payments.  You can find the per-acre non-specialty are all currently available on farmers.gov

MFP for Dairy and Hog Producers

Dairy and hog producers will also be eligible for payments.  Dairy producers who were in business as of June 1, 2019, will base their payment on the per hundredweight history production and hog producers will receive a payment based on the number of live hogs owned on a day selected by the producer between April 1 and May 15, 2019.

What You Need to Know About MFP Payments

The MFP payments will be made in up-to three tranches (portions). The second and third will be evaluated as market conditions and trade opportunities dictate. If conditions warrant, then second payments could arrive in November and third payments in January.  The first payments are to arrive in mid-to late August and will be comprise of the higher of either 50 percent of the producer’s calculated payment or $15 per acre.

The payments are limited to a combined $250,000 for non-specialty crops per person or legal entity. Eligible applicants must also have an average Adjusted Gross Income (AGI) for tax years 2014, 2015, and 2016 of less than $900K or 75 percent of the person’s or legal entity’s average AGI for tax years 2014, 2015, and 2016 must be from farming and ranching.

Producers who filed a prevented planting claim and planted and FSA-certified cover crop, with the potential to be harvested qualify for a $15 per acre payment. Acres that were never planted in 2019 are NOT eligible for an MFP payment.

For more information on MFP, visit www.farmers.gov/mfp or contact your local FSA office, which can be found at www.farmers.gov.

This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.

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