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Marketing Orders
Research and Promotion
Crop Insurance and Disaster Assistance
Market Access Program
Food, Conservation, and Energy Act of 2008
Vegetables and melons rarely enter mainstream farm policy
debates because of limited acreage and relatively small
Federal budget outlays on their behalf. Historically,
Federal price and income support programs have not directly
covered vegetables and melons, with most outlays stemming
from a variety of general, noncrop-specific programs.
Some of these include:
- Federal Marketing Orders are currently in force
for potatoes (four), onions (four), and tomatoes (one).
- Federally sanctioned national research and promotion
programs are in place for potatoes, watermelons, and mushrooms.
- Federal production assistance programs such as
Federal crop insurance, disaster assistance, and western
irrigation subsidies.
- Export programs such as the Market Access Program
(MAP) include several vegetables and melons.
- Federal food purchase and donation programs such
as the School Lunch Program and the Food for Peace Program
(P.L. 480) also cover vegetables and melons.
Marketing
Orders
Marketing orders and marketing agreements are designed
to help stabilize market conditions for fruit and vegetable
products. The programs assist farmers by allowing them
to collectively work to solve marketing problems. Industries
voluntarily enter into these programs and choose to have
Federal oversight of certain aspects of their operations.
For example, the only Federal marketing order in force
for tomatoes covers the majority of fresh-market tomatoes
produced in Florida between October and June. This order
authorizes the handling of Florida fresh-market tomatoes
by grade, size, quality, maturity, pack, and container.
Grade, size, quality, and maturity requirements established
under the order also are applied to tomatoes imported
between October 10 and June 15 (under so-called 8e requirements),
but the container and pack requirements are not. The order
also provides authority for production research, marketing
research and development, and marketing promotion, including
paid advertising. Visit USDA's Agricultural
Marketing Service (AMS) website for more information
about fruit, vegetable, and other specialty crop marketing
orders.
Research and Promotion
Federally sanctioned research and promotion programs
allow industry-funded joint promotion and research of
a commodity by growers/shippers. Programs are currently
in place for potatoes, watermelons, and mushrooms. Research
and promotion programs are intended to expand, maintain,
and develop markets for individual agricultural commodities
in the United States and abroad. The Secretary of Agriculture
appoints national boards to carry out these programs.
Membership may include producers, handlers, importers,
and processors (depending on which industry members pay
assessments to fund the programs) as well as public citizens.
The boards conduct promotion, market and production research,
and new product development under the supervision of AMS.
For more information, visit the AMS web pages for the
potato,
watermelon,
and mushroom
program areas.
Crop
Insurance and Disaster Assistance
USDA's Risk Management Agency administers crop
insurance policies for many crops, including an increasing
number of vegetables and melons, many of which have been
created since the late 1990s. Policies, which can vary
by State, may cover a single commodity regardless of its
end use or provide separate coverage for fresh and processing
markets.
Federal crop insurance is purchased prior to the growing
season and provides an indemnity payment if the farmer's
actual yield falls below a predetermined guarantee. The
policies are sold and serviced by private insurance companies.
Although crop insurance is not free to growers, the government
subsidizes a significant portion of the insurance premium.
Growers of vegetables and melons who do not purchase
crop insurance or do not have established Federal crop
insurance programs for their crops are eligible for Federal
financial assistance under the Noninsured
Crop Disaster Assistance Program (NAP), administered
by USDA's Farm Service Agency. The program provides
payments to qualified growers who lose at least 50 percent
of their crop or are unable to plant more than 35 percent
of their acreage due to a natural disaster. Payments are
made on the loss exceeding 50 percent of expected production,
based on producers' yield and production records.
The amount disbursed to vegetable and melon growers
under NAP varies depending on natural disasters (if any)
affecting crops in a given year. Because many commodities
in the vegetable and melon industry are still not part
of the Federal crop insurance program, growers of such
commodities are reliant on NAP.
In addition, vegetable and melon producers are frequently eligible for financial assistance during years of extensive crop loss. Producers of insured crops (covered by a crop insurance plan or NAP) may be eligible for the new Supplemental Agricultural Disaster Assistance and for ad hoc disaster aid.
Producers eligible for disaster assistance programs are
also eligible to apply for the Disaster
Debt Set-Aside Program, whereby they may be allowed
to set aside a portion of their Federal debt in order
to maintain their farming operation (for more information, see Ongoing Disaster Assistance Programs for Agricultural Producers). Growers are also
eligible for emergency
loans and the Emergency
Conservation Program.
Market
Access Program
The Market
Access Program (MAP), administered by USDA's
Foreign Agricultural Service, provides matching grants
to commodity marketing boards and cooperatives to help
expand markets overseas for U.S. agricultural products.
Regional trade promotion organizations may also be grant
recipients. The vegetable and melon industry was directly allocated about $8 million in fiscal year 2008 MAP funds, about 4 percent of the $200 million program total. The industry will also likely benefit from allocations to State Departments of Agriculture and other industry or trade organizations.
Food, Conservation, and Energy Act of 2008
The Food, Conservation and Energy Act of 2008 was a groundbreaking farm act for the U.S. fruit and vegetable industry. Over the life of the current Farm Act (fiscal years 2008-13), approximately $3 billion is dedicated to issues of importance to the industry. These include programs covering nutrition, crop research, pest/disease programs, trade assistance, and conservation programs. In general, the legislation will help strengthen industry competitiveness in domestic and world markets. Fiscal years (FY) run from October 1 through September 30 of the designated year.
The Specialty Crop Competitiveness Act of 2004 became law in December 2004, but was subject to appropriation of funds each year, which were minimal. The major focus of this legislation was to provide block grants through the various State departments of agriculture for planning and conducting research programs of importance to local producers and consumers of specialty crops. The 2008 Farm Act reauthorizes and extends this Specialty Crop Block Grant Program through FY 2012 (the 2004 law ran through FY 2009). It also provides funding through the Commodity Credit Corporation (CCC) in the amounts of $10 million in FY 2008, $49 million in FY 2009, and $55 million per year during FYs 2010-12. Each State is to receive $100,000 or one-third of 1 percent of total funding for each fiscal year, whichever is higher.
The Technical Assistance for Specialty Crops (TASC) Program (introduced in the 2002 Farm Security and Rural Investment Act, or 2002 Farm Act) is designed to open, retain, and expand markets for U.S. specialty crops. It helps U.S. exporters address phytosanitary or other technical barriers that prohibit or threaten exports of U.S. specialty crops. Eligible crops include all cultivated plants and their products produced in the United States, except wheat, feed grains, oilseeds, cotton, rice, peanuts, sugar, and tobacco. The 2008 Farm Act funds the TASC program (through the CCC) in the amounts of $4 million in FY 2008, $7 million in FY 2009, $8 million in FY 2010, and $9 million for each of FYs 2011 and 2012.
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