Farmers hoping reconciliation bill brings relief

Farmers in Arkansas have faced a daunting gauntlet of low commodity prices, higher input costs, wild weather patterns and tariffs. It’s led to a record number of farm bankruptcies in recent years, but one problem that can be fixed – safety nets for farmers from the federal government – is on the verge of being reconciled to some degree.

“There have been nearly 60 farm equipment auctions since December,” said Hunter Biram, extension economist for the University of Arkansas System Division of Agriculture. “That’s about 10 times more than what we would typically see in this time frame and that’s an indicator of just how serious the economic downturn is in Arkansas agriculture.”

Net farm income is expected to continue its downward trajectory through 2026, and federal aid is the main thing that has blunted the downward spiral, Biram said. He co-authored a recent report on net farm income in the state.

The latest House and Senate versions of a federal spending bill offers some glimmer of hope, keeping farm safety nets largely intact, with some notable changes, he said.

“The Senate’s version of the reconciliation package is almost exactly like the House version in terms of the farm safety net, which I find to be pretty encouraging,” said Biram.

There are a variety of safety nets in farming including ARC, or Agriculture Risk Coverage, and PLC, or Price Loss Coverage. These programs are administered by the Farm Service Agency, part of the U.S. Department of Agriculture.

The ARC program provides payments when the county revenue for a farm is less than a guarantee set based on historical data and market conditions. The PLC program provides payments when the realized price for a covered commodity falls below its effective reference price, or target price.

Farmers urged Congress to raise to reference prices as commodity prices have plunged across the board. In the most recent report on net farm income for Arkansas, corn receipts dropped 48% since 2022, while cotton declined 11% since 2023 and rice has fallen 8% since 2024. The state’s most widely grown crop soybean rare down 31% since 2022.

“A stronger safety net will certainly help those who have been able to withstand the economic downturn so far. Many farmers have not been as fortunate to make it to this point.” said Biram.