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Letter to Sonny Perdue, Secretary of Agriculture - Bost Joins the Illinois Delegation in Clarifying Nass June Report

Letter

By:
Date:
Location: Washington, DC

Dear Secretary Perdue:

We are writing to request additional information regarding the United States Department of Agriculture (USDA) National Agricultural Statistics Service (NASS) June 28, 2019, Acreage Report, which introduced confusing and potentially contradictory information into a market that is already volatile. According to the American Farm Bureau Federation, following the report, "new crop corn futures fell by 19 cents and represented a $2.6 billion reduction in the value of new-crop corn."[i]

The June 2019 Acreage Report included a corn acreage estimate that was 3 percent higher than the June 2018 Acreage Report.[ii] In the 2019 report, however, surveyed farmers indicated that only 83 percent of intended corn acreage had been planted--significantly lower than the ten-year average.[iii]

Data published by USDA in the June 11, 2019, Office of the Chief Economist's World Agricultural Supply and Demand Estimates (WASDE), meanwhile, did not appear to show the kind of corn planting progress reported in the June 2019 Acreage Report. The June WASDE reported a decline in this year's projected corn acreage, reflecting "delayed planting progress observed during the month of May and into early June."[iv]

Adding to the confusion, on the same day the June 2019 Acreage Report was published, NASS released a separate notice that "excessive rainfall had prevented planting at the time of the survey" on which the Report is based.[v] According the NASS notice, the weather conditions led to planting delays in Illinois and 12 other key corn-producing states, meaning that farmers in these states must be re-interviewed to obtain more accurate acreage estimates.[vi]

This report had real financial consequences for Illinois farmers and farm communities who rely on accurate Acreage Reports. We have heard firsthand from farmers in our communities who were concerned that the report erodes confidence between farmers and USDA, caused problems between farmers and brokers, potentially undermined sound risk management efforts, and took away opportunities for farmers to make it through another tough year. One farmer reported that he lost $500,000 due to the sudden decrease in corn values.

In Illinois, acres planted in corn account for nearly half of our total farmland.[vii] The livelihoods of corn farmers in our state and across the Midwest depend on accurate USDA crop data. Given the extraordinary challenges currently facing Illinois agricultural communities, it is vital that farmers receive the best information to make decisions impacting the future of their businesses.

Therefore, we request an explanation of why NASS did not provide adequate context to the June 2019 Acreage Report to avoid the immediate need for an extensive revision of the report. We also request an outline of measures that NASS will take to undo the current confusion and to ensure that future reports remain independently reliable and accurate.

On behalf of Illinois farmers, we thank you for your prompt attention to this important issue.

Sincerely,


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