May 22, 2020Signup begins May 26 for Coronavirus Food Assistance Program
Beginning May 26, eligible producers may apply for direct payments as part of the the Coronavirus Food Assistance Program, which allocated $2.1 billion for specialty crop producers who have suffered market losses from the COVID-19 pandemic.
Full CFAP program details were released this week. View the official rule here or visit farmers.gov/CFAP for more information.
How CFAP payments are calculated
USDA has written the CFAP rule to provide eligible specialty crop producers with partial compensation for sales losses and increased marketing overheads due to the COVID-19 pandemic. Compensation through the program is designed to cover a portion of these losses based on three loss scenarios detailed below. The payments will be available for eligible specialty crops for which a producer has production not subject to an agreed-upon price through a forward contract, agreement, or similar binding document.
Each scenario is accompanied by a set payment rate that was calculated by USDA. Please refer to the table on farmers.gov/cfap/specialty to determine the payment rate that you are eligible for, as not all crops are eligible for all payment scenarios. The three payment scenarios are as follows:
Payments for crops that had a five percent-or-greater price decline in sales price between January 15, 2020, and April 15, 2020. Producers must offer records, such as a bill of sale, documenting the price received for the crop.
Payments for crop shipments that left the farm by April 15, 2020, and spoiled due to no market. Producers must obtain documentation, such as a letter from the buyer, explaining non-payment or other record validating non-payment. This applies to producers who have met contractual obligations in delivering the crop to the buyer, but have not been paid.
Payments for crop shipments that did not leave the farm by April 15, 2020, (for example, were harvested but sitting in crates on the farm), or mature crops that were unharvested by that date (for example, were plowed under) due to lack of buyers, and which have not been and will not be sold.
Again, it is important that you refer to the table on the CFAP website to determine your eligibility per crop for direct payments. The example below should provide some clarity on how to use this table:
Example: How a loss of 1,500 lbs of beans would be paid out under the three scenarios.
To calculate, determine the volume lost under each scenario and multiply that loss by the payment amount listed on the CFAP website.
Scenario 1: Price Decrease 1,500 lbs x $0.17/lb=$255.00 paid out
Scenario 2: Left the farm and spoiled before market 1,500 lbs x $0.16/lb=$240.00 paid out
Scenario 3: Product never left the field 1,500 lbs x $0.03/lb=$45.00 paid out
Please note: You will receive only 80% of your eligible CFAP payment within the first few weeks of submitting your application. Only if CFAP funds remain after initial payments are dispersed, then you may receive the remaining portion.
USDA also explained the calculation in a video here.
Payments are based on a rate-per-pound distribution sum from the CARES Act and the Commodity Credit Corporation. Refer to the payment table here. https://www.farmers.gov/cfap/specialty
Payments also are subject to a per-person limit of $250,000, or a corporate entity limit of $750,000. Producers should refer to the full language on pages 9-10 of the rule document for specific details.
View FFVA’s latest member bulletin with details, or go to www.farmers.gov/CFAP for more information.
– Gene McAvoy , University of Florida IFAS Southwest Florida Research and Education Center