Climate Bill Impact on Ag Becomes More Clear
Some farmers would benefit from the House version of the climate bill by being paid to plant trees, while the fresh fruit and vegetable industry likely would face higher production costs.
Under the House plan, from 2015 to 2050, about 85 percent of revenue from agricultural-related carbon offsets would come from creating woodlands, reports Reuters. By 2050, about 59 million more acres of woodland would be created.
The forestry offsets would be worth about $3 billion a year, said Joe Glauber, the chief economist at the U.S. Department of Agriculture. The Midwest and South Central states would get the lion’s share, with the Northeast getting about 11 percent.
According to EPA modeling, total farm income would be about $22 billion higher per year, not counting the offsets, Reuters reports. The rise would come from higher crop and livestock farmgate prices. Farmers might also derive extra income from using low- and no-till methods, by revising their use of fertilizer or even capturing methane from manure.
Agriculture Secretary Tom Vilsack said that the House climate bill posed a “real opportunity for agriculture,” reports Agriculture.com.
However, depending on the economic model used, input costs clearly would rise. For corn, costs would rise $1.44 an acre, using a model from the EPA. Using data from the Department of Energy, the projection rises to $4.72 an acre.
As for the fresh fruit and vegetable industry, average costs would rise about 2 percent in the short term and up to 4 percent in the coming decades, according to The Packer.
But Kam Quarles, Vice President of Government Relations and Legislative Affairs for the United Fresh Produce Association, Washington, D.C., told The Packer that the USDA/EPA analysis looks only at on-farm production, and does not include the extra energy and emissions associated with transporting and storing sensitive fresh produce, which must be refrigerated.
Instead, Quarles said that USDA and lawmakers should take a “360 degree” perspective regarding the impact to the fresh produce industry, including the competitive advantage gained by growers in other nations who may not have the same costs added to their operations.
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