New CFAP details emerge: Dairies eligible for payments on milk, cull cows, some youngstock, some crops

CFAP_GUIDE_FSA (1)
USDA Farm Service Agency has created this guide for farms applying for CFAP payments.

By Sherry Bunting, Farmshine, May 29, 2020

HARRISBURG, Pa. — When Coronavirus Food Assistance Program (CFAP)payment details were first released last week, the understanding was that payments for livestock price losses would not include dairy production cattle. Also noted at that time was that crops on dairy farms could only be claimed if they were cash crops.

This week, however, as USDA Farm Service Agency (FSA) began the enrollment process on May 26, new details about implementation have emerged, meaning dairy farms have multiple areas of assistance to apply for.

Dairy cull cows and youngstock sold for other than dairy purposes can be claimed under certain classes of livestock under CFAP.

“This was a confusing point, and some portions are still not clear yet,” said Cynthia Walters, FSA dairy programs specialist for Pennsylvania in a Center for Dairy Excellence industry call Tuesday.

“Dairy cows sold for beef from January 15 through April 15, 2020 are eligible for payment under the ‘slaughter cattle, mature cattle’ category. We are still waiting to find out if dairy cull cows can be listed in inventory for that second portion of the payment for second quarter,” she said.

Walters also explained that cattle kept on a dairy farm as beef inventory will qualify for the inventory calculation. This would pertain to animals fed for beef or youngstock intended for sale to a veal grower or beef feedlot, or fed for the beef market as part of the dairy farm operation.

As for feed crops, Walters explained that some calculations are still being worked out to convert dairy feeds grown on farms to grain rates under the “non specialty crop payments” portion of the spreadsheet.

CDE_table (1)

The Center for Dairy Excellence created this table to show examples of CFAP payments for various farm sizes based on first quarter milk production.

Milk payments

As reported in Farmshine last week, only the first quarter milk production on a dairy farm is used by FSA to calculate the farm’s total Q1and Q2 milk payments.

Walters explained that producers will “self-certify” and keep their documentation on hand in case they are pulled for spot checks. Farms will not provide this documentation to FSA but use their milk statements and other records (such as dumped milk recorded) to fill out the forms.

She confirmed that the only production information the producer puts on the form / spreadsheet are the pounds of milk produced from January 1, 2020 to March 31, 2020. This will be paid at a rate of $4.71 per hundredweight. The second quarter production will be calculated using the January through March production figure, multiplied by a factor of 1.014, and then paid at $1.47 per hundredweight.

The total payment — using these two formulas together — will then roughy equate to $6.20 per hundredweight for the equivalent of first quarter milk pounds.

Walters reminded dairy producers that all first quarter milk production is eligible, even those pounds that were enrolled in risk management programs.

CFAP_Livestock_Payment_Rate_Figure_2 (1)

Farm Bureau created this graph to show payments for eligible classes of livestock.

Cattle payments

There are two parts to the assistance for cattle: A payment per head for cattle sold between January 15, 2020 to April 15, 2020 and a different payment per head for cattle inventory subject to price risk on a date of the producer’s choosing between April 16 to May 14, 2020.

For example, cull dairy cows sold for beef between Jan. 15 and April 15 would be listed under ‘slaughter cattle, mature cattle” and qualify for $93 per head. The inventory method for after April 15 does not apply to dairy cows that are considered dairy inventory, only beef cattle inventory are eligible for the second type of cattle payment.

For calves and heifers sold for other than dairy purposes, the Jan 15 to April 15 marketings would be listed under Feeder Cattle. In the less than 600-pound category, the payment is $102 per head. In the over 600-pound category it is $139 per head.

As for choosing an inventory date between Apr. 15 and May 14 for youngstock that are intended for sale as beef, veal or feedlot animals, they can be listed for an additional $33 per head payment.

Dairies feeding Holstein or Dairy-cross cattle for the beef market or raising / backgrounding such calves for feedlots may apply for all relevant cattle payments.

USDA confirmed in a media call that livestock payments will only go to producers with eligible livestock. Processor-owned livestock are not eligible for these direct farm payments, and a separate program will be designed for livestock producers who were forced to euthanize animals due to COVID-19 supply chain disruptions.

CFAP_Non_Specialty_Payment_Rate_Figure_1 (1)

Farm Bureau has created this graph to show payments for eligible non-specialty crops.

Crop payments

Included under non-specialty crops are payment rates for malting barley, canola, corn, upland cotton, millet, oats, soybeans, sorghum, sunflowers, durum wheat and hard red spring wheat.

These crops, if grown on dairy farms for feed, are also eligible under inventory with conversions to grain prices — as long as these crops were “subject to price risk” or incurred market costs due to COVID-19 disruptions.

In the case of corn silage, for example, Walters said producers would use their Jan 15 inventory, the amount owned by the producer on January 15 that was subject to future price risk.

PaymentCalculator (1)
This payment calculator spreadsheet is part of the application form for CFAP payments. It can be downloaded at farmers.gov/cfap under “CFAP Application” or at this direct link 

FSA application process

“The direct financial assistance through CFAP is for commodities with 5% or greater price decline or market costs from disruptions due to the virus,” said Walters.

She noted that farm enrolled with FSA for other programs have their eligibility already on file (AGI forms, highly erodible lands conservation, banking information for direct deposit, and contact information). This streamlines the process for filling out the application electronically or faxing or mailing it in.

Walters said FSA employees can help dairy producers walk through these categories on the calculator spreadsheet that is now available at farmers.gov/cfap.

Producers can also enroll for CFAP payments online and do not have to set up an appointment with FSA as long as they have been an FSA customer in the past and have all of the FSA forms in place. The USDA has provided a payment calculator for farmers to download at farmer.gov/cfap under “CFAP Application.” It is also available at this direct link.

This gives producers the option to print the application after entering their data, and then sign it and submit it to their County FSA Office by email, fax, or mail.

Farm consultants, such as nutritionists, can assist their clients in downloading and using these forms and in calculating relevant feed crop inventory.

FSA offices are being inundated with calls. Walters noted that a CFAP Call Center is also available for producers who would like additional one-on-one support with the CFAP application process at 877-508-8364.

The main information needed to begin the application process includes:

1) Settlement milk checks for January through March 2020,

2) Receipts of cull cows sold January 15 through April 15, 2020,

3) Inventories of grain not under contract and inventories of corn silage on hand as of January 15 paid on grain conversion,

4) Direct deposit information,

5) Farm ownership structure if needed to be eligible for expanded payment limits for larger, multi-generational farms.

Walters was quick to point out that there is plenty of time to apply for CFAP payments.

“These funds are NOT first-come, first-served. The department is paying 80% of a farm’s total eligibility to be sure there is enough funding for all farms,” said Walters. “Applications will be accepted until August 28, 2020, and the other 20% of a farm’s payment will come later.”

In addition, USDA is purchased $437 million in additional milk and dairy products, including $317 mil. so far for the Farmers to Families Food Boxes as part of the CFAP program.

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