Farm subsidies are payments or other forms of financial support made by the federal government to qualifying farmers and agricultural businesses. Sometimes, they are referred to as agricultural subsidies. If farmers find that these subsidies are not enough or that they are not eligible, they may consider taking advantage of USDA loan programs. However, farm subsidies play an important role in ensuring food security as well as the success of farmers nationwide.
Agricultural Subsidies Are Important
Farm subsidies bring much-needed economic stability to the agricultural industry. This industry is fraught with all kinds of uncertainties, including demand, uncertain conditions including the weather, impact from natural calamities, etc. Additionally, they ensure that the domestic food supply is secure.
A large percentage of the population is also dependent upon this industry. However, that percentage has been rapidly declining, showing how difficult it can be to farm in the 21st century. All of this makes for a strong case for subsidies.
Farming Is Still Profitable
A simple overview of cut-rate USDA loan programs shows that despite how difficult farming can be, there is still interest in the industry. Data shows that the top five best years for farm earnings in the last 30 years have occurred after 2004.
Who Subsidies Benefit
Sadly, it is the largest farms that secure the most in subsidies. In fact the biggest 15% of businesses in the farming industry avail of nearly 85% of subsidies.This leaves small farmers to seek out farm financing elsewhere to help fund their operations.
Subsidies or Loans?
That is a question our advisors at AgAmerica tackle every single day. We can help you compare subsidies that you may qualify for against available USDA loan programs and other financing options. Contact us today!