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Fewer Farmers Participating in Conservation Reserve Program

As food prices continue to rise -- especially for corn given the mandate in the 2005 energy bill to produce more ethanol – fewer farmers are letting their land lay fallow and accepting payments for not planting.

The payments for not-farming come via the Conservation Reserve Program (CRP). The program is designed to prevent soil erosion, reduce sedimentation and pollution in waterways due to runoff, and increase habitat for wildlife. In February 2008, some 34 million acres were part of the CRP with farmers paid between $44 and $125 per acre, on average, to refrain from farming. The upper end of the scale is from the Conservation Reserve Enhancement Program (CREP). CREP is for land that abuts ecologically sensitive habitat like wetland; here in Maryland, it applies to land near the barely-hanging-on Chesapeake Bay

But now, the per-acre payments are paltry when compared to wheat at $9 a bushel (yield is about 50 bushels per acre, or $450) and corn at $6 a bushel (yield is about 140 bushels per acre, or $840). And farmers want out of their decade-long contracts with the CRP.

The National Cattleman's Beef Association and the American Soybean Association support early release from contracts; the National Association of Wheat Growers does not, fearing increased planting=increased supply=lowered prices

While the farmers and the USDA battle it out, I wonder if anyone is taking into account the economic benefits of the CRP. If the CRP truly prevents 450 million tons of soil erosion per year, sequesters carbon and protects wetlands, then it is preventing economic loss by helping to prevent global warming, which in turn helps prevent unstable weather patterns. Considering the economic costs of moderate-to-severe drought, as in the upper midwest and southeast, the CRP may prove more valuable in the long-term than any acre of corn or wheat could be.

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