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Marketing Orders
Research and Promotion
Crop Insurance and Disaster Assistance
Trade Promotion Programs
Food, Conservation, and Energy
Act of 2008
Vegetables and melons are rarely part of mainstream farm
policy debates because they grow on limited acreage and
are recipients of relatively small Federal budget outlays.
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 (five), 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 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.
Trade
Promotion Programs
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.
The Foreign
Market Development Program, also administered
by USDA's Foreign Agricultural Service, works with nonprofit
U.S. agricultural trade organizations to develop, maintain,
and expand long-term export markets for U.S. agricultural
products. Program activities focus on reducing market
impediments, improving the processing capabilities of
importers, modifying restrictive regulatory codes and
standards in foreign markets, and identifying new markets
or uses for U.S. products. Of the $34.5 million program
total in fiscal year 2008, about $321,000 went to the
vegetable sector (the U.S. Dry Bean Council and the USA
Dry Pea and Lentil Council).
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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