US farm bill seeks to boost production while offering farmers affordable financing

By Sevgi Geren Gokkoyun

The US farm bill, a package of legislation to support the country’s agriculture, stands out as a leading mechanism in agricultural production worldwide, providing farmers with financing, conservation, and more, all the while boosting the US agricultural sector.

Official figures show that the agriculture, food, and related industries contributed over $1.5 trillion to US gross domestic product (GDP), making up 5.6%.

More than some 22 million workers are employed in the agriculture and food sectors, accounting for 10% of total employment, while direct farm employment makes up about 2.6 million, and the share of food in household expenditures in the US is at 13%.

Agricultural activity happens nationwide in the US, as corn and soybeans are grown in the East, wheat in the West, vegetables and nuts in California, cotton, tobacco, and rice in the South, and citrus fruits in Florida.

Through advances such as genetically modified organisms and better farming equipment, the US spearheads agricultural innovations as a global leader.

- Farm bill aims to boost agricultural production through modern methods

The cornerstone of current US agricultural policy is the farm bill, also known as the Agriculture Improvement Act of 2018, focusing on increasing farmer incomes and promoting sustainable practices.

The bill supports US farmers and forest managers via loans, conservation, and disaster relief, providing them with opportunities to boost water quality, reduce soil erosion, enhance wildlife habitats, and repair disaster-stricken lands and fields.

The administration of President Joe Biden extended the farm bill until the end of September to integrate environmental issues into farming practices, in the process boosting the resilience and sustainability of the sector, all the while emphasizing climate-friendly agricultural practices.

Through the bill, subsidies are provided to farmers based on the crops planted or past production levels, while supporting production with access to increased and guaranteed financing to make and expand farms at favorable interest rates.

The US capitalizes on its competitive advantage in large-scale, efficient production systems, as the nation produces more than one-third of the world’s corn, while producing and exporting tropical fruits and vegetables.

While the US does not have centralized agricultural production planning, farmer decisions are heavily influenced by prices, weather conditions, and technological advancements.

The Agriculture Department’s crop production report provides farmers and agribusinesses with forecasts in planning, and government interventions, such as buying surplus commodities during downturns help to stabilize prices.

*Writing by Emir Yildirim in Istanbul