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Marketing Orders
Research and Promotion
Crop Insurance and Disaster Assistance
Market Access Program
Specialty Crop Competitiveness
Act
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 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 or ad
hoc disaster aid for financial assistance during years
of extensive crop loss.
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. 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 fruit and vegetable industry has a sizeable
presence in the MAP, receiving about one-third of the
total $200 million allocated in fiscal year 2005.
Specialty
Crop Competitiveness Act
The Specialty Crop Competitiveness Act of 2004 became
law in December 2004, but Congress did not appropriate
funds to operate the program. The four title Act authorizes
a total of $54 million annually over 5 years to enhance
production and use of specialty crops and improve the
world competitiveness of U.S. producers of fruit (including
dried fruit), vegetables, tree nuts, and nursery crops
(including floriculture). About 80 percent of the funding
(subject to annual appropriation of funds) is earmarked
for block grants through the various State departments
of agriculture for planning and providing programs, subject
to approval by the U.S. Secretary of Agriculture, that
are of importance to local producers and consumers of
specialty crops.
The Act also authorizes an additional appropriation of
$2 million annually to support section 3205 of the 2002
Farm Bill, which provides assistance to remove, resolve,
or mitigate sanitary and phytosanitary and related barriers
to trade. The Technical Assistance for Specialty Crops
(TASC) Program 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. Since 2002, TASC has been funded at $2 million
per year. Another research title in the Act authorizes
the annual appropriation of $5 million for research into
methyl bromide alternatives. In mid-2005, Congress allotted
an initial $7 million for the Act.
Reference
For further detail, see the Fruit
and Vegetable Backgrounder (April 2006).
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