After the first round of the Coronavirus Food Assistance Program (CFAP) funding ended on September 11, USDA announced a second round of funding that started September 21. The new program, CFAP-2, is a marked improvement on the last version with more eligible commodities and a payment option based on lost income rather than price decline. A notable exclusion is that contract livestock growers are still ineligible to apply.
We have provided a high-level summary of CFAP-2 below. Check out the linked resources for more detailed information.
Still not sure if you’re eligible or need one-on-one help with the application? Email our Farmer Advocate, Craig Watts, at [email protected] to schedule a phone appointment to discuss if CFAP-2 is a good option for you. Or call us anytime through the RAFI-USA Farm Hotline at 866-586-6746. The USDA has also set up a CFAP Hotline, 877-508-8364, to offer further assistance.
Parts 1/2 of 4 Videos on Applying for CFAP-2
For more information about the first round of CFAP funding, visit our earlier blog post here.
WHAT: CFAP-2 is a direct payment (not loan) program developed by USDA to distribute an additional $13.21 billion in payments to agricultural producers impacted by price reductions or lost revenue (NEW) due to COVID-19.
WHO: Active farmers with a share in an eligible commodity produced in 2020.
WHEN: Applications opened September 21 and will remain open until December 11, 2020
ELIGIBLE COMMODITIES: Almost all crops and livestock are eligible under CFAP-2 and apply to one of three payment calculations. A farmer may be eligible for three payments depending on what commodities they produce. Notable ineligible commodities include those produced under contract when the farmer does not maintain ownership (i.e. contract poultry).
- Price Trigger: Similar to CFAP-1, farmers who produced commodity crops (i.e. soybeans, wheat, corn), dairy, broilers and eggs (NEW), or livestock between April 1 – August 31, 2020 are eligible to receive a payment proportional to the decline in price of the commodity due to COVID-19.
- Flat Rate Crops (NEW): This payment option is for farmers who grew a specific commodity crop between April 1 – August 31, 2020 where there is insufficient pricing data to demonstrate a decline in price (i.e. hemp, cotton, peanuts). Payments will be calculated using the flat rate of $15 per acre.
- Sales Commodities (NEW): A very important change to CFAP-2 is the option to receive a payment based on lost sales due to COVID-19 for commodities not covered by Price Trigger or Flat Rate Crops. This opens up access to many farmers who couldn’t apply under CFAP-1 or for whom the financial return was too low. Many specialty crops, nursery, aquaculture, and other livestock are listed as eligible commodities. Payments are calculated based on 2019 sales revenue of the eligible commodities multiplied by the CFAP payment rate (listed below).
Example: A producer’s 2019 sales of eligible commodities totaled $75,000. The payment is calculated as ($49,999 times 10.6%) plus ($25,001 times 9.9%) equaling a total payment of $7,775.
APPLICATION: Farmers may complete an online application or visit their local FSA office. Farmers new to FSA are encouraged to apply at their local office to ensure all documentation is collected. Visit the USDA CFAP website and download the CFAP calculator to determine the payment amount and complete the application. Farmers will need certain production, inventory, or revenue records based on their commodity.
POTENTIAL DOWNSIDES: CFAP-2 payment calculations still 1) do not account for premium priced commodities (i.e. organic, grass-fed, direct-to-consumer price, or any value added to a raw products) and 2) growers are ineligible to receive payment for commodities produced that they do not own themselves (i.e. contract poultry). There are also no set aside funds for small-scale farmers, local marketing farmers, or historically underserved farmers.
BOTTOM LINE: CFAP-2 includes important changes that will allow more farmers to access COVID-19 relief funds, even though some payments may be modest compared to the real impact. Farmers who determined that CFAP-1 was not right for them should reassess whether to apply under CFAP-2.
The Nuts and Bolts of CFAP
For a more detailed look at CFAP, we recommend checking out some of the following resources created by USDA and our national partners.
- USDA CFAP Website – Review the full list of eligible commodities and payment structures and download the payment calculator and online application.
- More Money Available to Farmers Impacted by the Pandemic – Take a look at a more comprehensive review of CFAP-2 eligibility, the application process, and the determination of payments (National Sustainable Agriculture Coalition).