Here's Summary of Farm Bill;
How Does It Affect You?
THE AGRICULTURAL ACT of
1949 makes price supports manda
tory for the "basic" commodities—
wheat, com, cotton, rice, tobacco and
peanuts—and for certain designated
nonbasic commodities—wool, mo
hair, tung nuts, honey, Irish pota
toes, milk, butterfat and the prod
ucts of milk and butterfat.
Price support is permissive for
other nonbasic commodities at the
discretion of the secretary of agri
culture.
Dual Parity System
A major feature of the agricul
tural act of 1949 is the application
Parity Prices Compared
Old and New Formulas
Old New
Beef Cattle (Cwt.) $13 $17
Wheat .
Milk (Cwt.) ...
Butterfat (lb.) .
Wool (lb.)
Potatoes (Bu.)
Hogs (Cwt.) ...
Eggs .....
Turkeys (lb.) ..
Barley . ..
2.12 1.87
3.84 4.38
.631 .698
.439 .498
1.75 1.60
17.40 18.80
.516 455
.346 .362
1.49 1.21
of a dual parity system.
The act sets up a new parity for
mula using the 10-year moving aver
age parity formula (average of the
last 10 crop years) provided in the
agricultural act of 1948 amended to
INCLUDE WAGES paid hired help
and to include wartime subsidies
paid to producers under OPA.
BUT until 1954 the old parity for
mula (1909-1914 average, no allow
ance for wages) MAY STILL AP
PLY to all basic commodities. Until
1954 parity prices of the basic com
modities are to be parity under ei
ther the new or the old formulas,
WHICHEVER IS THE HIGHER.
Basic Crop Supports, (wheat, corn,
cotton, rice, tobacco, peanuts)
In 1950 supports will be 90 per
cent of parity to co-operators (grow
ers who do not knowingly exceed
their allotments) if marketing quotas
have not been disapproved and if
either allotments or quotas are in ef
fect. (Parity will be figured on ei
ther the old or new formula, which
ever is the higher. Present esti
mates for wheat are that the old will
be higher than the new—$2.14 a
bushel as compared to $1.88.)
Supports at 50 percent of parity
will be available to growers who
comply with acreage allotments if
producers disapprove marketing
quotas.
In 1951 supports will be at 80 to
90 percent of parity (actual percent
to be determined by the secretary
of agriculture) if marketing quotas
have not been disapproved and
either allotments or quotas are in
effect. Support will be 50 percent
of parity to co-operators if quotas
are disapproved.
In 1952 and after, supports will
be 75 to 90 percent of parity (new
formula only after 1953). Com,
wheat, rice supports will be 90 per
cent of parity as long as supplies
do not exceed 102 percent of normal.
As supplies increase above 102 per
cent they are to be reduced at the
rate of 1 percent of parity level for
each 2 percent increase of excess
supply until they are 75 percent of
parity for supplies more than 130
percent of normal.
BUT support levels provided by
the flexible schedules are mini
mums. The secretary of agriculture
MAY SET SUPPORT PRICES
ABOVE these minimum levels up
to a maximum of 90 percent of par
ity if he desires.
Wool (including mohair) — Price
support for wool (including mohair)
is to be established at such level
between 60 and 90 percent of parity
(calculated by the "new" formula)
as the secretary of agriculture de
termines is necessary to encourage
an annual production of approxi
mately 360,000,000 pounds of shorn
wool.
Tung nuts, honey, and Irish pota
toes—The support level is between
60 and 90 percent of parity (as cal
culated by the "new" formula.)
Whole milk, butterfat, and the
products of such commodities —
Prices are to be supported at such
levels between 75 and 90 percent of
parity (as calculated by the "new"
formula) as will assure an adequate
supply. Such price support is to be
provided through loans on, or pur
chases of, the products of milk and
butterfat.
Other Nonbasic Commodities
Price support for nonbasic agri
cultural commodities, other than the
designated commodities, is permis
sive at any level not in excess of 90
percent of parity. In determining
whether support will be provided
for any nonbasic commodity, and im
fixing the level of such support, the
following factors are to be consid
ered: (1) the supply of the commod
ity in relation to the demand there
for; (2) the price levels at which
other commodities are being supi
ported and, in the case of feed
grains, the feed values of such grains
in relation to corn; (3) the availabil
ity of funds; (4) the perishability of
the commodity; (5) the importance
of the commodity to agriculture and
the national economy; (6) the ability
to dispose of stocks acquired
through a price-support operation;
(7) the need for offsetting temporary
losses of export markets, and (8)
the ability and willingness of pro
ducers to keep supplies in line with
demand. In determining the level
of support for undesignated non
basic commodities, particular con
sideration must be given to the level
of support for competing commodi
ties.
So far as feasible, price support
is to be made available to co-oper
ators on any storable nonbasic ag
ricultural commodity for which a
marketing quota or marketing
agreement or order program is in
effect at levels not in excess of 90
percent of parity and not less than
the level between 75 and 90 percent
of parity called for by a sliding
scale set forth in the act.
But the secretary of agriculture
may provide for support at a lower
level than that called for by the
sliding scale if, after consideration
of the eight factors listed above, he
determines it to be desirable and
proper.
TO
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POWER
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