But rice and peanut farmers argue that the crop insurance and the new shallow loss or Agriculture Risk Coverage programs are better fitted to crops such as corn, where natural disasters such as floods and droughts can cause far greater fluctuations in yields. Many rice farmers, who irrigate their crops and have more consistent yields, don't have crop insurance to protect them from yield loss, but they do have to cope with large swings in prices and high production costs.
Linda Raun, who runs a 1,000-acre rice farm southwest of Houston and chairs the USA Rice Producers Group, said direct payments have been their only safety net in the past. Without price protection, banks won't lend them money, she said. "We've got to have a farm program that allows us to become bankable."
Raun said production costs amount to about $1,000 an acre for rice. Because of a reliance on foreign export markets, prices can change rapidly. Currently prices for southern rice are not that good, unlike the strong prices enjoyed by corn and soybean growers.
A recent study by the Food and Agriculture Policy Institute at the University of Missouri in Columbia does show that rice and peanut growers who are the main beneficiaries of direct payments would lose more than 60 percent of their government support over the next decade under the new system.
But the same report also found that the shallow loss program was generally equitable among the major crop groups.
Southern senators are seeking to negotiate changes to the bill that would allow a choice between the Senate's current crop insurance and revenue protection programs and some modified form of existing target price program that compensates farmers when prices dip below a certain level and which is preferred by the rice and peanut growers. The bill already has a separate revenue insurance program tailored to the needs of cotton farmers.
If that fails, House Agriculture Committee Chairman Frank Lucas, R-Okla., has made clear that the yet-unwritten House bill will include an alternative to meet the concerns of those Southern planters.
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