Some Can’t Be Saved by U.S. Drought Relief, Officials Say : Farmers May Go Under Despite Aid

Southeastern officials say that federal drought-relief measures will not prevent large numbers of financially distressed farmers from going under but that the aid possibly will help thousands of others survive.

“Certainly, this will help keep those who should not have to leave farming, those who have good managerial ability and, through no fault of their own, have found themselves in a serious situation,” Georgia Agriculture Commissioner Tommy Irvin said in an interview.

Congress and the Agriculture Department swung into action last week after seeing that it would take more than massive volunteer hay shipments to alleviate the worst drought to hit the Southeast in more than 100 years.

Agriculture Secretary Richard E. Lyng announced a series of emergency measures that included offering cattle farmers half-price feed and sending all farmers their regular income subsidy payments months ahead of schedule.

Additional Aid

Meanwhile, Congress has moved close to enacting several additional steps, including hay transportation subsidies and disaster compensation for growers of wheat, corn, peanuts, soybeans and cotton.

Additionally, farmers in 189 counties that have been declared disaster areas are eligible for low-interest federal loans.

Cost estimates for the various efforts range from $300 million to more than $1 billion.

“There is no question these measures will go a long way toward getting our farmers started on a reasonable assistance program,” said Frank Bordeaux, the state of North Carolina’s chief agricultural economist.

However, Bordeaux cautioned that eligibility rules for the aid may turn out to be more restrictive than indicated by politicians’ rhetoric.

“All that glitters is not gold in this kind of situation. We need to see the fine print on how these programs will be administered when they get to the local level,” Bordeaux said.

Meeting Today

To discuss such concerns and to press for even more aid, the agriculture commissioners of Maryland, Virginia, North Carolina, South Carolina, Georgia, Alabama and Florida will meet with key members of Congress and Administration officials here today.

Even before the drought and accompanying heat wave rolled in this summer, many Southeastern farmers faced almost certain bankruptcy because of depressed prices and heavy debt--about 1,500 farmers in South Carolina, 5,000 in Georgia and 6,000 in North Carolina. But thousands more who were in less critical straits are now facing problems caused by the drought, and these are the farmers whose survival may depend on federal assistance, officials said.

“About 8% of our farmers may not be salvageable,” Bordeaux said. “But the federal programs could give valuable assistance to another 10% or 15%,” helping them pay fertilizer bills, restock cattle, purchase hay or restructure debt, he said.

Many Could Benefit

In Georgia, Irvin said, the programs could provide significant help for as many as 20,000 farmers in serious financial trouble. James Miller of the University of Georgia’s Cooperative and Extension Service agreed that many marginal farmers could benefit from proposed disaster payments of up to $100,000.

Disaster payments “may be the only thing that keeps some of those guys in business,” said Robert Mullins, legislative director of the National Farmers Union. He noted that many farmers are not covered by federally subsidized crop insurance.

However, Georgia farmer Herbert Jacobs, who is struggling to maintain 1,000 acres of corn, cotton, soybeans and peanuts near Statesboro, is not so sure that the new government programs will be helpful.

“Because of the red tape, I’m afraid it will do only a small amount of good,” he said.

Paying for Shipping

Mullins hailed a provision in pending legislation that would require the government to pay 80% of the cost of shipping hay to the Southeast from surplus producing areas in the Midwest.

Mullins said volunteer hay shipments are covering short-term needs of cattle farmers but are not expected to continue long enough to supply feed through the winter. Thus, many farmers will desperately need the 80% shipping subsidies, he said.

Rob Nooter, an analyst with the American Farm Bureau Federation, is less certain that the shipping subsidies will provide enough relief.

“Eighty percent is better than not getting any assistance, but for a lot of producers there will still be great financial hardship and one that may be more than they can sustain.”

What the farmers need most, Uncle Sam cannot provide--rain. Norton Strommen, the Agriculture Department’s chief meteorologist, said the influx of scattered showers and cooler, more seasonal temperatures in recent days has provided “a welcome break in the persistent decline of conditions in the Southeast.” However, he said, “it will take significantly more rainfall over the next four to six months to begin to alleviate the impact of that drought.”