Market Facilitation Program: Impacts and Initial Analysis

USDA released details on aid it will provide to farmers in response to trade disputes, resulting in tariffs instituted by the U.S. and retaliatory tariffs from trading partners, especially China. This article focuses on the Market Facilitation Program (MFP) which will have the largest impact on incomes of Midwest grain farms.   The MFP provides cash payments to farmers for a subset of commodity crops, including corn and soybeans that are commonly grown in the Midwest.  Payments are to be made using a specific rate per bushel on 2018 actual production.  In Illinois, average payments are estimated at $53 per acre for soybeans, $1 per acre for corn, and $5 per acre for wheat.  MFP payments will significantly increase 2018 net farm incomes.  Payment rates for corn are low relative to those for other crops.