The passage of the farm bill this week restores key market development programs for the U.S. wheat industry, says the vice president of communications for U.S. Wheat Associates.
Steve Mercer said the bill includes funding for USDA Foreign Agricultural Service’s Market Access Program (MAP) and Foreign Market Development (FMD) program at levels equal to the previous bill, with $200 million for MAP and $34.5 million for FMD.
The majority of Pacific Northwest wheat goes overseas, Mercer said, and funding from the programs helps overseas buyers understand how to use wheat from the United States, the quality of wheat available, how to purchase it and how to develop new products.
U.S. Wheat qualifies for USDA market development program funds by preparing a Unified Export Strategy annually and demonstrating state wheat commission support.
For the 2012-2013 year, U.S. Wheat received roughly $6.4 million from MAP and $4.8 million from FMD.
FMD ended Sept. 30 and MAP ended Dec. 30. U.S. Wheat will receive funding for the programs approved last year, Mercer said.
While the programs were unavailable because of lack of a farm bill, USDA’s Foreign Agriculture Service worked to make funding unspent in previous years available to organizations like U.S. Wheat, Mercer said, but the organization was going to have to consider using credit or dipping into reserves to cover costs. It will likely take several weeks once the bill is signed to receive funding, he said.
State organizations provided additional funding to help cover costs in recent years, particularly commissions in the Pacific Northwest, he said.
The organization will submit in May for the next year of funding, to begin Oct. 1 for FMD and January 2015 for MAP.
Mercer said the total amount for FMD has remained the same for 20 years, and MAP for 10 years. The mandatory spending bills are subject to sequester. U.S. Wheat expects the amount to be cut by 8 percent, and Foreign Agriculture Services is taking administrative costs out of the budget as well, he said.
“A lot more commodity groups are applying for MAP funding,” Mercer said.
U.S. Wheat has done well when competing for the funds because of support from producers, he said. In 2012-2013, U.S. Wheat received roughly $5 million from producers. USDA committed $2.30 for every $1 from producer funds, according to U.S. Wheat.
U.S. Wheat’s total available budget from USDA in 2012-2013 was $11.7 million, which primarily goes to U.S. Wheat’s overseas offices for foreign market development, according to the organization. MAP funding is used for activities and FMD funding for office and staff overseas, Mercer said.
Total U.S. Wheat funding for the 2013 fiscal year was $16.5 million.