The Obama administration has announced it expects the 10-year budget deficit to reach $9 trillion. This is approximately $2 trillion more than was estimated earlier this year. The administration said the deficit is a “result of a deeper-than-expected recession, certain spending programs (such as unemployment insurance and food stamps) are projected to automatically increase and revenues are projected to automatically decline, compared to our previous projections.” Congressional members were raising concerns earlier this year about the increasing deficit. This could have an impact on the health care debate when Congress returns after Labor Day.
Farm Storage Facility Loan Program — USDA announced changes to the Farm Storage Facility Loan (FSFL) program as a result of the 2008 farm bill. This will allow producers of eligible commodities to obtain low-interest financing to build or upgrade farm storage and handling facilities. The maximum principle amount of a loan through FSFL is $500,000. Participants are required to provide a down payment of 15%, with the Commodity Credit Corporation (CCC) providing a loan for the remaining 85% of the next cost of the eligible storage facility and permanent drying and handling equipment. Loan terms of 7, 10 or 12 years are available depending on the amount of the loan. Interest rates for each term rate may be different and are based on the rate which CCC borrows from the Department of the Treasury. Corn, grain, sorghum, rice, soybeans, oats, peanuts, wheat, barley or minor oilseeds harvested as whole grain are the commodities that are eligible for the program.
Governors Ask Support for Pork Industry — Governors from key pork states are asking President Barack Obama to take action to assist the U.S. pork industry. The governors in a letter to the president stated that the “pork industry is facing an economic crisis that is catastrophic in nature. In 2008, producers suffered their second-worst financial year ever.” The governors are asking the administration to: 1) support at least an additional $50 million of pork purchases for government feeding programs; 2) remove the spending cap on the Section 32 program so that additional purchases of surplus agriculture products can be undertaken by USDA using funds already appropriated for this purpose; and 3) work to have China to quickly lift the H1N1 ban and eliminate other barriers to U.S. pork exports. Governors signing the letter were Bill Ritter (CO), Pat Quinn (IL), Chet Culver (IA), Steven Beshear (KY), Jennifer Granholm (MI), Dave Heineman (NE), Bev Perdue (NC), Brad Henry (OK) and Jim Doyle (WI).
P. Scott Shearer