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Before President Trump signed the $2 trillion CARES Act in March, the National Potato Council was hard at work to figure out a relief plan for the industry.
According to Kam Quarels, CEO of the National Potato Council, that kicked off a series of meetings with managers and staff. The initial plan consisted of two parts.
“First, in the absence of consumer demand due to a government shutdown, we needed to push the government to temporarily become our customer and clear out the growing oversupply,” said Quarles.
USDA responded by purchasing $50 million in potatoes—the largest surplus commodity purchase in NPC history.
“Second, USDA needed to set up a meaningful, direct payment program for the industry to provide relief to impacted growers,” said Quarles.
Quarles said this has been more difficult. USDA’s $16 billion direct payment Coronavirus Food Assistance Program (CFAP) does not include aid for potatoes.
“Had USDA put in place some of the recommendations that our industry provided to them initially, they would have avoided a lot of the pain and negative headlines they’re seeing across the country,” he added.
If these changes aren’t made by USDA, Britt Raybould, president of the NPC, thinks there will be a resolution during discussions of the next round of CFAP payments.
“Even if USDA and Secretary Perdue can’t figure it out at this particular juncture, we have some confidence that there will be a remedy as part of the next package that comes through,” she said.
Typically, the fruit and vegetable industry has shied away from these types of payments. However, Raybould said this situation is unlike any the industry has ever seen.
“It’s a mix of not only economic issues, but there’s also issues as it relates to our supply chain—how we’re actually moving product from the field to market,” said Raybould. “There are factors that go so far beyond the scope of what we’re looking at. It didn’t seem wise to say, ‘Nope, we’re not going to go down this path simply because we’ve never done it before.’ Instead, we needed to make sure we kept every tool available to us so we could best serve the industry because every state’s got something a little bit different going on.”
Quarels is optimistic USDA will do everything they can to include potato growers, but Congress will have to provide additional resources to make sure that happens.
“The initial stimulus package was really truncated—it was looking at the first quarter of this year, and clearly we’re not sure how all these twists and turns are going to evolve over the next six months,” he said.
NPC and the Michigan Potato Industry Commission sent a letter to Sec. Sonny Perdue asking for the potato industry to receive CFAP payments. That letter can be found here.
Audio recorded from the National Potato Council Virtual Summer Meeting.