Coronavirus Food Assistance Program (CFAP)
Are you a farmer or rancher whose operation has been directly impacted by the coronavirus pandemic? The Coronavirus Food Assistance Program will provide direct relief to producers who faced price declines and additional marketing costs due to COVID-19.
About the Coronavirus Food Assistance Program
USDA Secretary Sonny Perdue announced the Coronavirus Food Assistance program on April 17, 2020. CFAP will use funding and authorities provided in the Coronavirus Aid, Relief, and Economic Security Act, the Families First Coronavirus Response Act, and other USDA existing authorities. This $19 billion immediate relief program includes direct support to agricultural producers as well as the Farmers to Families Food Box Program.
CFAP will provide vital financial assistance to producers of agricultural commodities who have suffered a five-percent-or-greater price decline or who had losses due to market supply chain disruptions due to COVID-19 and face additional significant market costs. Eligible commodities include:
- Non-specialty Crops: malting barley, canola, corn, upland cotton, millet, oats, soybeans, sorghum, sunflowers, durum wheat, and hard red spring wheat
- Livestock: cattle, hogs, and sheep (lambs and yearlings only)
- Specialty Crops
- Fruits: apples, avocados, blueberries, cantaloupe, grapefruit, kiwifruit, lemons, oranges, papaya, peaches, pears, raspberries, strawberries, tangerines, tomatoes, watermelons
- Vegetables: artichokes, asparagus, broccoli, cabbage, carrots, cauliflower, celery, sweet corn, cucumbers, eggplant, garlic, iceberg lettuce, romaine lettuce, dry onions, green onions, peppers, potatoes, rhubarb, spinach, squash, sweet potatoes, taro
- Nuts: almonds, pecans, walnuts
- Other: beans, mushrooms
USDA will consider additional crops to be eligible for CFAP by collecting information on potentially eligible crops. Eligible farmers and ranchers will receive one CFAP payment, drawn from two possible funding sources. The first source of funding is $9.5 billion in appropriated funding provided in the CARES Act and compensates farmers for losses due to price declines that occurred between mid-January 2020, and mid-April 2020 and for specialty crops for product that was shipped and spoiled or unpaid product. The second funding source uses the Commodity Credit Corporation Charter Act to compensate producers for $6.5 billion in losses due to on-going market disruptions.
Eligible producers (person or legal entity) of specified agricultural commodities outlined above who have suffered a five percent-or-greater price decline as a result of the COVID-19 pandemic, and who face substantial marketing costs for inventories, are eligible for CFAP payments.
To be eligible for payments, a person or legal entity must have an average adjusted gross income of less than $900,000 for tax years 2016, 2017, and 2018. However, if 75 percent of their adjusted gross income comes from farming, ranching, or forestry, the AGI limit of $900,000 does not apply.
Persons and legal entities also must:
- comply with the provisions of the “Highly Erodible Land and Wetland Conservation” regulations, often called the conservation compliance provisions;
- if a foreign person, provides land, capital, and a substantial amount of active personal labor to the farming operation; and
- not have a controlled substance violation.
CFAP Payment Limitations and Structure
CFAP payments are subject to a per person and legal entity payment limitation of $250,000. This limitation applies to the total amount of CFAP payments made with respect to all eligible commodities.
Unlike other FSA programs, special payment limitation rules will be applied to participants that are corporations, limited liability companies, and limited partnerships (corporate entities). These corporate entities may receive up to $750,000 based upon the number of shareholders (not to exceed three shareholders) who contribute at least 400 hours of active person management or personal active labor.
For a corporate entity:
- With one such shareholder the payment limit for the entity is $250,000;
- With two such shareholders, the payment limit for the entity is $500,000 if at least two members contribute substantial labor or management with respect to the operation of the corporate entity; and
- With three such shareholders, the limit is $750,000 if at least three members contribute substantial labor or management with respect to the operation of the corporate entity.
To ensure the availability of funding throughout the application period, producers will receive 80 percent of their maximum total payment upon approval of the application. The remaining portion of the payment, not to exceed the payment limit, will be paid at a later date as funds remain available.
Beginning May 26, USDA’s Farm Service Agency will be accepting applications from agricultural producers who have suffered losses. The application form and a payment calculator for producers will be available online once signup begins.
CFAP Payments for Livestock
A single payment for livestock will be calculated using the sum of the producer’s number of livestock sold between January 15 and April 15, 2020, multiplied by the payment rates per head, and the highest inventory number of livestock between April 16 and May 14, 2020, multiplied by the payment rate per head.
Producers must provide the following information for CFAP:
- Total sales of eligible livestock, by species and class, between January 15, 2020, to April 15, 2020, of owned inventory as of January 15, 2020, including any offspring from that inventory; and
- highest inventory of eligible livestock, by species and class, between April 16, 2020, and May 14, 2020.
The following table lists eligible livestock and payment rates for CFAP.
|Livestock||Eligible Livestock||Unit of Measure||CARES Act Part 1 Payment Rate||CCC Part 2 Payment Rate|
|Cattle||Feeder Cattle: Less than 600 Pounds||Head||$102.00||$33.00|
|Feeder Cattle: 600 Pounds or More||Head||$139.00||$33.00|
|Slaughter Cattle: Fed Cattle||Head||$214.00||$33.00|
|Slaughter Cattle: Mature Cattle||Head||$92.00||$33.00|
|All Other Cattle||Head||$102.00||$33.00|
|Hogs and Pigs||Pigs: Less than 120 Pounds||Head||$28.00||$17.00|
|Hogs: 120 Pounds or More||Head||$18.00||$17.00|
|Lambs and Yearlings||All Sheep Less than 2 Years Old||Head||$33.00||$7.00|
CFAP Payments for Non-Specialty Crops
Producers will be paid based on inventory subject to price risk held as of January 15, 2020. A single payment will be made based on 50 percent of a producer’s 2019 total production or the 2019 inventory as of January 15, 2020, whichever is smaller, multiplied by 50 percent and then multiplied by the commodity’s applicable payment rates.
Producers must provide the following information for CFAP:
- Total 2019 production for the commodity that suffered a five percent-or-greater price decline, and
- Total 2019 production that was not sold as of January 15, 2020.
The following table lists eligible non-specialty commodities and payment rates for CFAP.
|Commodity||Unit of Measure||CARES Act Payment Rate||CCC Payment Rate|
|Barley (malting barley only)||bushel||$0.34||$0.37|
|Wheat, Hard Red Spring||bushel||$0.18||$0.20|
CFAP payments are eligible to all dairy operations with milk production in January, February, and/or March 2020. Any dumped milk production during the months of January, February, and March 2020 is eligible for assistance.
CFAP Payments for Dairy
For dairy, a single payment will be made based on a producer’s certification of milk production for the first quarter of calendar year 2020 multiplied by $4.71 per hundred weight. The second part of the payment is based a national adjustment to each producer’s production in the first quarter multiplied by $1.47 per hundred weight.
A single payment for dairy will be made calculated from two funding sources. Those include:
- CARES Act – The payment will compensate producers for price losses during the first quarter of 2020, and
- CCC Funds – The payment will compensate for marketing channel and demand disruptions for the second quarter of 2020 – April, May, and June – due to COVID-19.
If you have questions about the CFAP, contact our experts today!