More Alaska Pork - and not the kind from a pig... Reimbursed Transportation Costs for Alaskan Farmers

Today, the USDA announced a program to reimburse farmers in Alaska, Hawaii and other remote U.S. territories for transportation costs to ship agricultural commodities into and out of the state.  Producers can get up to $8,000 in reimbursement costs annually under the latest farm bill.   [I'm guessing that costs were limited so that Dole can't get the whole sum allotted by Congress for shipping pineapple out of HawaiI!]

Admittedly, Alaskan farmers face a tough challenge particularly procuring new equipment and animals.   The small tractor I purchase last year included over a thousand dollars in shipping charges - so in this sense, the program makes sense.  Flying equipment into a location such as Hooper Bay, mentioned below, is certainly expensive.  Anyone in a remote village trying to grow crops there needs significantly more than $8K to ship large equipment to them.  One of the biggest things threatening our industry is the closure of the Agrium plant on the Kenai -- our only in-state fertilizer plant.  Should fertilizer have to be brought in from Outside, this rule would help blunt that impact.

I'm not aware of any significant Alaskan agricultural exports that this program would benefit.  With the national emphasis favoring  locally and environmentally sound food, is the USDA really expecting milk producers in MatSu to want to ship bottles  to Seattle?  Or Delta grown beef to Los Angeles?   Furthermore, I'm hoping that the food being grown in Hooper Bay is being eaten locally - not shipped away from the people who need it.

Furthermore, would the Matsu vodka , reindeer sausage, or Delta bison sausage, qualify? It seems that processed foods are what we ship Outside the most  - not raw commodities.   My reading of the rules says that, unless these are produced by the farmer that grew the potatoes, reindeer, or bison, the answer is No.

It seems to me that a better way to help Alaskan producers -- and the taxpayer -- is to STOP subsidizing the guys in the lot 48!  As an example, Alaska dairies are competing with artificially cheap milk from Washington State that is days old.   From 1995 to 2009, Alaska received approximately $0.6 million in dairy subsidies; Washington state received $92.5 million; Wisconsin, $988.2 million.  The big corporate farms - with thousands of cows and lots of accountants -- know how to work the USDA grant system much better than our Mom and Pop producers up here (who on an individual basis, get very little).

Dropping price supports is what will truly level the playing field for local producers, driving local innovation while taking advantage of local labor and materials. Subsidizing transportation only furthers our dependence on things produced Outside.  For example, cheap shipping of  fertilizer from Outside coupled with the lack of natural gas pipeline will probably kill the Kenai Agrium plant for good.   Local milk will never be cheaper than that produced by huge corporations receiving millions from the government.  Furthermore, let's stop paying farmer's not to farm under the Conservation Reserve Program.  How is letting Alaskan land sit idle supposed to develop an infrastructure again?  While I'm all for helping farmers, subsidies such as these tend to complicate, rather than solve, problems.

_______________________________________________________________________________
Federal rules on the program can be found here.

Daniel Consenstein, from the USDA office in Palmer, sent out an email to registered producers that included the following, as quote below:

(Palmer, Alaska), June 16, 2010 – Danny Consenstein, Executive Director of USDA’s Farm Service Agency in Alaska, announced that Alaskan farmers and ranchers who experience high transportation costs will soon see relief through funding authorized through the  Food, Conservation and Energy Act of 2008 (Farm Bill).  

“Last summer, Agriculture Secretary Tom Vilsack visited Palmer, Bethel and Hooper Bay.  He saw first-hand the challenges faced by Alaska producers.  This program will help level the playing field for our producers and provide more local food at competitive prices by addressing our high costs of doing business,” said State Executive Director, Danny Consenstein.  “USDA is committed to developing new programs like this that fit the needs of Alaska farmers and ranchers.  I also want to thank Senator Begich and the congressional delegation for including funding for this program in the FY2010 Appropriations bill.” 

“The Obama Administration believes farm programs should provide the stability and predictability agricultural producers need,” said Agriculture Secretary Tom Vilsack.  “American producers outside the contiguous States often have to take extraordinary measures to transport needed items to their farms and ranches, and then experience substantial costs when they transport their farm output to markets.  This program will provide relief to eligible producers who are at a competitive disadvantage.”

Vilsack said recent rising fuel costs have made this competitive disadvantage worse.  The payments announced today through the Farm Service Agency (FSA) are intended to offset a portion of the costs of transporting agricultural inputs and products over long distances. 

The Reimbursement Transportation Cost Payment Program for Geographically Disadvantaged Farmers and Ranchers (RTCP) assists farmers and ranchers in Alaska, Hawaii, and areas including the Commonwealth of Puerto Rico, Guam, American Samoa, Commonwealth of the Northern Mariana Islands, U.S. Virgin Islands, Federated States of Micronesia, Republic of the Marshall Islands and Republic of Palau who paid to transport either an agricultural commodity or an input used to produce an agricultural commodity.

The Agricultural, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010 (2010 Agricultural Appropriations Bill) provided $2.6 million for this Farm Bill program in fiscal year 2010. 

Sign-up for RTCP will begin on Aug. 2, 2010, and end on Sept. 10, 2010.  Applicants must file their RTCP application for benefits at with their local FSA county office no later than Sept. 10, 2010, and applicants also will have until Nov. 1, 2010, to provide supporting documentation of actual costs of transporting agricultural inputs and commodities in fiscal year 2010 to the FSA county office. 

For more information about this program, please visit your FSA county offices.  In Palmer, contact Doug Carter, at 761-7772 or doug.carter@ak.usda.gov.  In Delta,  contact Lloyd Wilhelm, 895-4242 ext. 100, or  lloyd.wilhelm@ak.usda.gov, or  www.fsa.usda.gov.

USDA is an equal opportunity provider, employer and lender. To file a complaint of discrimination, write: USDA, Director, Office of Civil Rights, 1400 Independence Ave., S.W., Washington, D.C. 20250-9410 or call (800) 795-3272 (voice), or (202) 720-6382 (TDD).