News Release: TCFA Urges USDA to Remove Payment Limits for Cattle Producers Who Suffered Losses Due to COVID-19

Amarillo, Texas - The Texas Cattle Feeders Association (TCFA) today called on U.S. Agriculture Sec. Sonny Perdue to remove payment limitations on producers that have suffered extraordinary losses as a result of the COVID-19 pandemic.

“We are grateful for Sec. Perdue’s support of U.S. agriculture and the cattle industry during these unprecedented times, and appreciate USDA’s payment assistance,” Paul Defoor, TCFA chairman, said.

“We understand that USDA is in the difficult position of allocating assistance levels for each segment of agriculture; however, the $125,000 payment limit per commodity fails to recognize the size and scope of the many cattle operations in Texas and across the nation. The proposed limit will preclude most cattle feeders in Texas, Oklahoma and New Mexico from receiving any meaningful assistance relative to their actual losses.”

Earlier this month, a study led by Dr. Derrell Peel with Oklahoma State University projected market losses of $13.6 billion for cattle producers — $247.15 per head for cow-calf producers, $159.98 per head for stocker operators, and $205.96 per head for cattle feeders.  

TCFA members annually market more than 6,000,000 fed cattle or 28% of the nation’s fed beef. Under proposed payment limitations, the average TCFA feedyard (35,000 head capacity) will recoup less than 1% of actual losses. In addition to feedyard losses, the average producer who owns and markets 2,500 head of cattle in a custom feedyard will recover less than 25% of their loss. A mere 600 head will hit the $125,000 payment limit.    

“Our industry is facing unprecedented times in the wake of market disruptions. While the relief is welcomed, the caps simply aren’t substantial enough to stabilize the cattle feeding industry — an essential component of our nation’s food supply,” he said.  

Current USDA disaster assistance programs, including the Emergency Assistance for Livestock andthe Livestock Indemnity Program, do not impose payment limitations due to the extraordinary and unforeseen nature of producer losses.  

“USDA has precedence for not establishing payment limitations on producers who have suffered extraordinary losses as a result of disasters. Disaster assistance in response to COVID-19 should be no exception,” Defoor said.

Background on USDA Assistance

On April 19, 2020, USDA announced the $19 billion Coronavirus Food Assistance Program (CFAP). The program uses funds provided in the Coronavirus Aid, Relief, and Economic Security Act (CARES), the Families First Coronavirus Response Act (FFCRA), and other USDA existing authorities.  

The program provides $16 billion in direct support based on actual losses for agricultural producers where prices and market supply chains have been impacted by COVID-19.  

This includes $9.6 billion for the livestock industry, specifically $5.1 billion for cattle. 

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Texas Cattle Feeders Association (TCFA) represents the cattle feeding industry in the three-state region of Texas, Oklahoma and New Mexico. This area, known as Cattle Feeding Country, is the largest cattle  feeding region in the U.S. A multi-billion-dollar industry, it annually markets more than 6 million fed cattle – approximately 28 percent of the fed cattle produced in the United States.