Agricultural and Food Policy
 Agri Outlook
Radio
Number 74
Policy: Part 1. Key points to consider as the Senate debates the new farm
bill on agricultural policy, the global economy, and the need for a strong safety net for
the U.S. rice and cotton sector. (2:19 minutes)
Audio/Video Script:
Dr. Bobby Coats
Extension Economist
University of Arkansas, Division of Agriculture
The trend in U.S. farm policy is producing consolidation and rapid structural
change for U.S. rice and cotton producers. This trend will not change, but
future policy mechanisms will determine how orderly or disruptive the change
takes place on rice and cotton farms. I’m Bobby Coats Extension Economist
University of Arkansas Division of Agriculture.
The trend in U.S. rice and cotton policy is for producers to respond to
global market signals and produce for the market. Since rice and cotton farm
government programs are not indexed to compensate for inflation’s erosion of
benefits then producers are very responsive to the markets direction.
The consequence of the current farm bill coupled with the economic setting is
structural change in the rice and cotton sector is occurring at the fastest pace
experienced in decades. It is important to understand that the outcome of this
rapid change is not understood. Since producers and analysts do not understand
the outcome of current policy, then one can more clearly understand why
producers are politically sensitive about policy that further accelerates
change. Thus, U.S. rice and cotton producers are extremely concerned about their
financial future.
A key point even if no changes were made to current farm policy: our rice and
cotton producers are in an accelerated state of transition to responding to
global market signals and this is creating rapid structural change to their
farming operations. To accelerate the structural change to the U.S. rice and
cotton producer and expose our producers to additional unknown risks and
uncertainty when they are already exposed to the most uncertainty and risks that
they have experienced in their farming career will be counterproductive to the
farmer, to the rural area, and to U.S. farm and trade policy.
This has been Bobby Coats Extension Economist University of Arkansas Division
of Agriculture.
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