Thousands of U.S. farmers have a decision to make this month, as they must choose to either keep their acres in the Conservation Reserve Program (CRP) or put those acres into crop production.

Conservation Reserve Program (Photo: usgs.gov)

Nationwide, there are 1.1 million acres in CRP contracts that will expire this month. Landowners holding those contracts will be weighing their options, making a judgment on whether to renew or to pull their acres out of the CRP program.

The number of CRP acres up for renewal jumps to 3.8 million acres in 2009, and then 4.4 million acres in 2010, according to a statement from U.S. Agriculture Secretary Ed Schafer in July.

Typically, the type of land that is enrolled in the CRP program is environmentally sensitive and erodible. The program was designed to keep those lands out of production to conserve soil and protect water resources, as well as to improve wildlife habitat. With millions of acres of farmland in CRP, the program also tends to protect against the overproduction of crops and can help maintain steady grain prices.

CRP has long had its detractors. Those critical of the program have called it a wasteful handout to landowners, paying farmers not to farm. Since its creation in the early 1980s, however, the program has been renewed every five years as a part of the federal farm bill. In 2005, the USDA spent approximately $1.7 billion in CRP payments to landowners.

Now that global demand is strong and commodity prices are high, many farmers may choose against renewing their CRP contracts to plant more corn and other grains. The CRP rental rates simply are notas lucrative as planting a field of corn.

In an interview last week with the Iowa Independent, Iowa Secretary of Agriculture Bill Northey said farmers are going to have some difficult decisions to make regarding CRP. Northey said some farmland may now be worth significantly more in cash rent than in CRP. For those farmers, he said, “it’s got to be really hard to keep it in CRP. You’ve got to really believe in [CRP] to keep it in, when you could be getting almost twice as much by farming it.”

With CRP rental rates not keeping up with the value of farmland, landowners will consider the bottom line.

“I run into some farmers out there that ask about it. I can see that they’re thinking about it,” said Northey. “They’re trying to figure out what to do.”

Opponents of alternative fuels such as ethanol have pointed to federal renewable fuels incentives as the reason farmers may choose to opt out of CRP. The demand for corn has increased because of ethanol, but landowners will consider other factors as well.

The penalties for taking land out of a CRP contract before the agreed-upon time can be steep. A farmer typically must return all payments received during the entire period of the CRP contract in order to be released early from the contract.

A simple lack of flexibility in the program may be what turns some farmers off. The USDA attempted this year to release CRP land for haying and grazing under its critical feed use program, but that action was mostly thwarted by a lawsuit filed by the National Wildlife Federation. Because of that lawsuit, it is now more difficult for the USDA to use its discretion and release CRP for feed uses when farmers really need it.

U.S. Secretary of Agriculture Ed Schafer visited the 2008 Farm Progress Show in Boone, Iowa on Thursday.

Implementation of the new farm bill will ultimately be handed off to the next presidential administration, U.S. Secretary of Agriculture Ed Schafer said at a press conference in Iowa Thursday.

Schafer told agriculture reporters at the 2008 Farm Progress Show that the implementation of the new farm bill is “going well,” with the work about two weeks ahead of schedule.

“We have prioritized the programs, and some programs come to us with certain timelines and deadlines,” said Schafer. “We’re working through methodically to produce the rules and regulations. And, importantly, we understand that we will not get this farm bill fully implemented before the end of this administration. So it will go off into the next administration.”

One of the major tasks that Schafer’s department must complete soon is the implementation of the new country-of-origin labeling program for retail food products. Country-of-origin labeling was passed into law in 2002, but was never implemented by the U.S. Department of Agriculture. The new farm bill that passed this year mandates that the labeling law be implemented by Oct. 1. Schafer said that the USDA is on track to do so and has published its interim final rule for the program.

“I believe we came up with a set of regulations that are understanding of people’s concerns, of producers’ concerns, and the cost to the consumer,” he said. “I like the regulations the way they came out. There’s a lot of controversy all the way around, but I think we struck a good balance with this, and we are in the position to deliver it on October 1.”

Schafer said he anticipates “bumps in the system” regarding regulation of the program. He said the USDA will allow a six-month implementation period in which the department will work with retailers and producers for a smooth transition. During the six-month period, he said, the USDA won’t be “coming in with the hammer or the summons book, but we’re coming in to say this is the new law, this is how we work through it. So we’ll have that grace period to work through so we can get it implemented properly.”

Other aspects of the farm bill will cost more to implement than the USDA has been given, he said, noting that the department cannot implement some of the new programs with the hardware and software currently in place. He has requested an additional $179 million from Congress to fund the shortfall. “One difficulty that we’re facing is we required and asked for $200 million for implementation for the new farm bill, and we received about $55 million, so we simply don’t have enough money.”

Schafer also discussed the Conservation Reserve Program, which has been in the news recently following a lawsuit filed by the National Wildlife Federation. Schafer said he would like to see legislation passed that would bring more flexibility to the program and allow the USDA to change CRP contracts. “The conversation has definitely not stopped,” he said. “It is being pursued legislatively on the hill, which is where the final answer is going to rest.”

Conservation Reserve Program (Photo: usgs.gov)

According to a press release from Senate Agriculture Committee chairman Tom Harkin, D-Iowa, the USDA will release CRP acres for haying in counties that have received a presidential disaster declaration and contiguous counties because of the recent flooding. This release includes almost all of the state of Iowa.

U.S. Secretary of Agriculture Ed Schafer issued a release for livestock grazing on CRP acres for these same counties on July 7.

Harvesting of hay on CRP lands under the emergency release comes with several stipulations. CRP participants will receive a 25 percent payment reduction and harvesting will be limited to one cutting of hay. Additionally, one half of the field or contiguous fields in CRP must be left unharvested for the protection of wildlife, and all haying must cease on Sept. 30. Participants must write their county Farm Service Agency office and receive a modified conservation plan and approval before beginning to harvest hay.

Harkin had submitted numerous requests for the emergency CRP release for haying, and just this week he was joined by all of the members of Iowa’s congressional delegation in calling for the release.

“The disaster caused by this summer’s flooding has forced us to look at new ways to allow Iowa producers to provide for livestock,” said Harkin in the press release. “It was critical for USDA to release CRP lands for grazing. Yet it is important for producers in Iowa — many of whom no longer have fencing or livestock watering facilities on their CRP land — to be able to use CRP hay to feed their livestock or to market it. Emergency haying and grazing is permitted on lands affected by drought, and with the nesting season over, it only made sense to open this land for haying.”

The primary nesting season for wild birds in Iowa was determined by the USDA to be completed by Aug. 2 this year.

The emergency release of CRP acres for haying and grazing will only affect designated counties in 16 states. And while it will be welcome news to many livestock producers who have been struggling this year with the high cost of feed, a broader nationwide release of CRP land was what many really had hoped for.

That nationwide CRP release, under the Critical Feed Use program, was mostly derailed when a Seattle court found in favor of the National Wildlife Federation in a lawsuit two weeks ago.

Iowa’s other senator, Republican Chuck Grassley, said Tuesday in a conference call with agriculture reporters that he wants to change the law to override the court ruling on the CRP Critical Feed Use program.

Grassley announced that he is co-sponsoring a bill with Sen. John Thune, R-S.D., that will “implement the Critical Feed Use program and do it as originally intended by the USDA.”

Grassley said that the court stepped in and ruled in such a way to “dilute the value of the critical feed program,” adding that the lawsuit came at a very bad time for farmers. “The court issued an arbitrary ruling, which, well, just simply and essentially cut off many farmers who wanted to participate,” said Grassley.

Grassley said that the court, in fact, may be accurately interpreting the law, but if that is the case, “then we need to rewrite the law.” He said that the arbitrary ruling of the court resulted in farmers being treated inequitably, because some farmers who had applied before the deadline would be allowed to participate, while others who had missed the deadline would not be allowed to participate.

Photo: usgs.gov

A ruling issued Thursday by U.S. District Judge John C. Coughenour placed some limits on this year’s release of CRP, however, and both sides of the battle seem to be happy with the results of the court case.

As reported last week on the Iowa Independent, the Seattle court case involved a lawsuit filed by the National Wildlife Federation. In a telephone interview Thursday with the Iowa Independent, NWF spokesman Duane Hovorka said his organization is pleased with the ruling.

“We think that the ruling agrees with our position that the USDA did not, in this case, do the adequate review that they needed to do,” said Hovorka. “And we’re also pleased that we can recognize and take care of the farmers and ranchers who relied on the USDA and went out and applied for the program and spent money. We recognize that it caused some hardship for those folks, the farmers and ranchers who in good faith applied for the program, and we’re pleased that we’re not causing them further harm.”

The lawsuit claimed the U.S. Department of Agriculture failed to complete the proper environmental impact studies before it announced a plan to release CRP acres nationwide for haying and grazing under the Critical Feed Use program. The USDA announced in May that it would allow a Critical Feed Use release of all CRP acres for haying and grazing after the primary nesting season for birds is completed. In Iowa, that release date falls on Aug. 2.

Nationwide, the USDA’s plan was intended to bring relief to livestock producers who have been suffering under high costs of feed and forage caused by high demand and poor weather conditions. An estimated 18 million tons of hay would be made available through the Critical Feed Use release of CRP acres.

Under the conditions of the court ruling, any farmer who applied and was already approved for the Critical Feed Use program will be allowed to continue with their plans. Additionally, any farmer who had submitted an application to the USDA and was awaiting approval will also be allowed to continue with the plans, but there will be some limits to the time frame for haying and grazing.

In the future, however, the USDA will not be allowed to release CRP for the Critical Feed Use program without completing the lengthy environmental impact assessment process.

“Basically, the USDA can’t do this kind of thing in the future without doing the environmental impact study that federal law requires,” said Hovorka. “I think the implication for the future is that before the USDA makes major decisions like this that are going to have environmental impacts, they need to do the studies that are required under federal law before they make the decision.”

Despite the fact that future releases of CRP through the Critical Feed Use program will be slowed down by environmental impact studies,  the ruling was trumpeted as a “major win for farmers and ranchers” by the American Farm Bureau Federation. In a statement released Thursday, AFBF president Bob Stallman said that the court recognized that the program will be of great benefit to farmers and ranchers in dealing with the increased costs of feeding livestock.

Another agricultural organization, the National Farmers Union, also viewed as positive. In a press release Thursday, NFU president Tom Buis called the ruling a “fair resolution to a difficult situation.”

CRP acres in most of Iowa’s counties have already been released for grazing this year as part of a different emergency release that was announced by the USDA earlier this summer.

The court ruling will affect Iowa farmers by allowing haying of CRP acres for those who had made plans and prepared to do so, and it will also indirectly affect livestock farmers by bringing much-needed livestock feed into the markets nationwide.

Thursday’s hearing in Seattle involved a lawsuit filed by the National Wildlife Federation. The suit claimed the USDA failed to complete the proper environmental impact studies before it announced a plan to release CRP acres nationwide for haying and grazing under the Critical Feed Use program. The USDA announced in May that it would allow a Critical Feed Use release of all CRP acres for haying and grazing after the primary nesting season for birds is completed. In Iowa, that release date falls on Aug. 2.

Nationwide, the USDA’s plan is intended to bring relief to livestock producers who have been suffering under high costs of feed and forage caused by high demand and poor weather conditions. An estimated 18 million tons of hay would be made available through the Critical Feed Use release of CRP acres.

Because of the devastating floods earlier this year, much of Iowa’s CRP acreage has already been released for grazing only through a different emergency program. The court injunction does not block the opening of CRP acres for grazing in presidentially declared disaster areas, a separate early release of CRP acres that was announced by the USDA last week. That release affected 97 of Iowa’s 99 counties, allowing emergency livestock grazing on CRP acres but not allowing the acres to be harvested for hay.

Although most of Iowa’s CRP acres are already available for grazing, many livestock producers would still like to see the nationwide CRP release go forward so that more feed in the marketplace could help bring down prices.

Iowa has approximately 1.8 million acres of land enrolled in the CRP program. When enrolled in the program, landowners sign 10- to 15-year contracts with the USDA and agree to leave the acres out of production. The farmers receive a payment from the government, and the program protects environmentally sensitive land and provides wildlife habitat. But CRP acres can be opened up for production when deemed necessary by the USDA.

In response to the court’s decision Thursday, Senate Agriculture Committee Chairman Tom Harkin, D-Iowa, said in a statement that he is hopeful that the court’s decision today will “lead to an agreement that mitigates environmental harms of any future announcements by USDA.”

Iowa Wildlife Federation

The National Wildlife Federation joined with its state-affiliate organizations from six states to file the lawsuit. State affiliates from Nebraska, South Dakota, Kansas, Washington, Louisiana and Indiana were involved in the lawsuit, but Iowa’s affiliate — the Iowa Wildlife Federation — was not involved.

In a telephone interview Thursday with Iowa Independent, Iowa Wildlife Federation president Joe Wilkinson didn’t comment directly about the possible areas of compromise that the organization may seek. But Wilkinson said that he fully understands the situation faced by Iowa livestock producers and supports the limited release of CRP acres in disaster areas. “The lawsuit only challenges the broader release of nearly 24 million acres nationwide without any payment reduction,” said Wilkinson. “The suit did not challenge the emergency haying and grazing in the actual states or counties. From what I know of the suit, that makes sense to me.”

“It is truly an emergency here in Iowa,” said Wilkinson. “I’m sitting in between the two rivers that flooded the worst. As president of the Iowa Wildlife Federation, I don’t disagree with the release of CRP in what are truly emergency acres — which would be practically every county in Iowa.”

Farm Bureau, Cattlemen, Pork Producers

Three major agricultural organizations have joined together to file an amicus brief in the court case, stressing the “severe economic hardship” that the court injunction has placed on farmers and ranchers. The American Farm Bureau Federation, the National Cattlemen’s Beef Association and the National Pork Producers Council all joined together to file the brief, which details the stories of farmers who have already invested money and time preparing to take advantage of the released CRP acres.

“More than 4,000 livestock producers relied on USDA’s announcement about the new program and have already begun using their precious financial resources to prepare the land for haying and grazing. It’s important for the court to hear from farmers and ranchers about the harmful effects of this injunction, both since July 8 when the injunction was issued and going forward,” said American Farm Bureau Federation president Bob Stallman in a statement.

Now that there is a serious shortage of livestock feed in the market due to terrible weather this year, Iowa Farm Bureau Federation President Craig Lang is calling for an immediate release of all CRP acres in Iowa.

Lang spoke about CRP Saturday at a tour of a flooded farm in Marion County, where Sen. Tom Harkin, D-Iowa, Rep. Leonard Boswell, D-Iowa, and Iowa Secretary of Agriculture Bill Northey were visiting with area farmers about the disastrous floods.

“Because we’ve lost about 16 percent of our forage ground in Iowa because of flooding, and also because of this impact that we’re going to see to the livestock industry with higher grain prices and lack of forage availability, Farm Bureau sent a letter to [U.S. Secretary of Agriculture] Schafer on Wednesday asking for immediate release of CRP for haying and grazing,” said Lang.

Many livestock producers are currently operating at a loss due to the high price of feed.

Livestock feed prices have shot to record levels in recent weeks because an estimated 10 percent of Iowa’s corn crop and 20 percent of the soybean crop was either flooded or never even planted. Acres that were planted late or replanted after flooding won’t produce normal yields, and it all adds up to a shortage of livestock feed.

Prices for meat at the grocery store are actually expected to drop in the coming months as many major livestock producers are selling off their herds because of the high price of feed. This situation is expected to cause a temporary abundance of meat products, followed by a shortage that could then send grocery bills sky-high.

Recognizing the problem earlier this year, the USDA had announced a release of all CRP acres for haying and grazing that would begin on Aug. 2. The Aug. 2 date was chosen because it would allow the primary nesting season for birds to reach its full potential.

Any farmer who has land enrolled in CRP will be required to pay a $75 fee to be able to cut hay or use it for pasture, but they will not receive any reduction of their regular CRP program payments.

The land can’t be mowed for hay or grazed if it is in wetlands or filter strips along streams and ponds. These types of lands are usually part of the Continuous CRP program and are not included in the release.

But Aug. 2 is too late in the year to provide much high-quality livestock feed. “This would really make a big difference here in southern Iowa, but it needs to be done now,” said Max Smith, a southern Iowa farmer and grain elevator operator. “But if you wait a month, that quality of hay won’t be very good.”

The USDA has also released CRP acres for grazing-only in certain counties that have been declared disaster areas, but Lang said the entire state’s CRP acres need to be opened up now for hay and grazing to release pressure on livestock feed markets.

“So you’re saying we should just move the Aug. 2 date up to now?” asked Harkin.

Lang said “yes” and the room full of farmers nodded their heads.

“Well, let’s see if we can get this done right away,” Harkin replied.

Before his keynote address at the conference on Friday night, he talked with the Iowa Independent about some state environmental issues, including water quality and deer management.

Below the fold, two videos with the Iowa DNR chief.Leopold, who said he is related only “in spirit” to the famous ecologist Aldo Leopold, talked about water quality. He said “Water quality is always a big issue, it ties into so many different things,” He explained that some livestock lots can be traced to fish kills because of poor management of manure and improper siting and placement of lots.

Leopold was also concerned about expiring Conservation Reserve Program (CRP) contracts. CRP is a federal program designed to protect environmentally sensitive areas, like stream buffers, grass waterways and hillsides. The program pays farmers not to plant crops in these spaces to limit soil erosion and runoff. He said recent corn prices are tempting farmers to bring those acres back into production.

Leopold talked about the number of bills before the Iowa Legislature pertaining to deer. He said he hoped that deer controls would be left to the DNR and biologists who can have a more “dynamic” response to deer population.

In this video he talks about deer management:

Wildlife photo by Rene Paine.