The U.S. Department of Agriculture said Monday that its new farm aid package includes direct payments of $4.7 billion to farmers that will help to offset the losses from the retaliatory tariffs placed on American exports the last few months.
The majority of the payments or $3.6 billion will go to soybean farmers. The payments for soybean farmers amounts to a price of $1.65 per bushel times 50% of expected production, said a government spokesperson.
Traditionally China has purchased approximately 60% of the soybean exports from the U.S., but since implementing their tariffs on imports from the U.S., has been for the most part out of the soybeans market. The tariffs were in retaliation for the White House tariffs placed on Chinese products.
Secretary of Agriculture Sonny Perdue said that an announcement related to additional payments would be made during the upcoming months if warranted.
The aid, first announced in July at $12 billion, will include payments for sorghum at 86 cents a bushel times 50% of production, 14 cents a bushel for wheat, 1 cent a bushel for corn and 6 cents a pound or cotton.
Payments to hog farmers equal $8 per pig times 50% of the production as of August 1. Dairy farmers are to get 12 cents per hundred weight of their production, said the USDA
The program sign-up begins September 4, and ends during January. Farmers must present production evidence in order to collect their monies, and payments will be capped at $125,000 per individual.
The program includes purchases of $1.2 billion of commodities that include dairy products and pork and will be spread over months, said the program director.
The specific commodities that are to be purchased are the ones that were impacted by the tariffs imposed by other countries, said the USDA.
The plan also includes $200 million for a program of trade promotion to develop different markets.
This package is considered to be a temporary boost to U.S. farmers as the Washington and Beijing negotiate all the trade issues on the table. It divided Republicans, some whom favor free trade and have been troubled by what they consider a type of welfare program the party has opposed in the past.
The program faced much skepticism from farmers, which are a key constituency of Trump.
A member of the Soybean Growers said that short-term aid does not make for market stability over the long term. Producers, he added, need trade and not aid.