farmgate: Conservation Reserve: Past and Future.
The site was a rolling hayfield near a pond just outside Peoria, IL, and then-Secretary of Agriculture John Block outlined to assembled farm reporters the concept of the Conservation Reserve Program which would become part of the 1985 Farm Bill. From that sunny, hot summer afternoon the CRP has been the primary engine of soil and water conservation, pulling many cars behind named WRP, EQIP, CSP, and others. Where has the CRP been over the past 22 years and where is it headed in the next Farm Bill?
Whether the CRP is the mainline engine of conservation or as Purdue’s Otto Doering calls it, “The 800 pound gorilla of American conservation programs—both in budget expenditure and in sheer size and geographical impact.” Doering’s analysis of the CRP reminds us that Congress has little to do with the Conservation Reserve Program, other than setting the acreage cap, which is currently at 39.2 million. The CCC administers the program contracts calling for 10 and 15 year grass and tree plantings on acreage accepted into the CRP program because of the environmental benefits provided idled acreage.
However, Secretary Block and his USDA colleagues were confronted with low grain prices, and the CRP was designed for a second purpose of supply management and income transfer through rental rates. The first big sign-up was in 1987, and since 10 year contracts can be renewed, 2007 will see considerable acreage become eligible for crop production for the first time in 20 years. But when the 1987 contracts for over 20 million acres were set to roll over in 1997 the USDA only accepted 16 million acres based on environmental benefits provided by the reenrollment.
Doering says the volume of acreage is an issue. Environmental groups want an increase to better support wildlife. Grain associations want a decrease in CRP acreage to ensure more grain production. Farmers have expressed concerns about the impact on the local agricultural economy when significant acreage is taken out of production. In 2006 USDA attempted an early extension program to ease the expected 2007 burden of work and 80% of the eligible land was given extensions up to 2010. When grain prices began to climb from acreage demand, there was a debate on whether land could come out of the CRP for corn ethanol production. USDA neatly delayed a decision until the issue was moot because of timing.
As the House Agriculture Committee embarked on Farm Bill debate several issues were posed for consideration as new policy
1) Extend the CRP to 2012 when the 2007 Farm Bill would expire.
2) Extend the pilot program for wetland and buffer enrollment to 2012.
3) Allow limited grazing for control of invasive species on CRP lands.
4) Use surveys in counties with 20,000+ acres to determine cash rents.
5) Allow CRP contracts to be modified where it would benefit social objectives.
6) Allow CRP contracts to be terminated by the landowner after 5 years.
Since the CRP is not likely to be changed very much because of its momentum within the environmental community, Congress will have some opportunity for small modifications, which include:
1) A decision of whether to allow contracts to be dissolved when acreage is needed for either food or fuel production.
2) Would the CRP be opened for biomass production to supply biofuels, and how would those provisions be met by the WTO.
3) Will the bidding process and the environmental rules be changed in ways that conservation becomes an entitlement program for landowners?
Summary:
The CRP will be included in the next Farm Bill because of its popularity. Policy makers are unlikely to shorten is funding because Congress is already insulated from acreage debate issues. However demand for corn acres to address ethanol needs may force the program to be opened at times previously unknown.
Posted by Stu Ellis on June 28, 2007 12:23 AM to farmgate