Agricultural Economics Department


Date of this Version

April 2005


Published in Cornhusker Economics, 04/06/2005. Produced by the Cooperative Extension, Institute of Agriculture and Natural Resources, Department of Agricultural Economics, University of Nebraska–Lincoln.


According to Secretary of Agriculture Johanns news release on February 7, 2005, the President’s 2006 budget proposes a net reduction in farm support program spending nationally of about $587 million in 2006, and $5.7 billion from 2006 through 2015. These proposals include: reducing the payment limitation for all commodity payments, making marketing assistance loans based on historical production and reducing all commodity payments to farmers by 5 percent. It is difficult to estimate the impact of any changes in the payment limitation. Nearly all producers have their business arrangements configured to avoid the current payment limitations, and their ability to do so in the future will depend upon the implementation of any new limitations and their ingenuity in adjusting to the new rules. The impact on Nebraska producers of these latter two proposals is estimated below.