US farmers welcome $8bn diesel relief package from Trump

American farm leaders have applauded a new $8bn (£6bn) relief package from Washington, designed to help the sector deal with sky-high diesel prices.

The package was announced earlier this week by president Donald Trump and US agriculture secretary Brooke Rollins to provide farmers and ranchers with a one-time payment to ease “temporary market disruptions and increased input costs”.

See also: Spike in red diesel prices as Middle East conflict continues

Road diesel is currently retailing at about $6.25/gal (£1.03/litre) in the US, compared with just $3.50/gal (57p/litre) at the start of the year.

Farmers and construction operators also benefit from a small 24.2c/gal (4p/litre) federal tax exemption.

Full details of how the new Harvest Fuel relief programme will be distributed and when have yet to be revealed, though the expectation is it will be after the mid-term elections in early November.

“This $8 billion dollar investment will help bring certainty to our farmers during this harvest so they can continue to feed our nation,” said Ms Rollins.

Reaction

The news has been well received by the American Farm Bureau Federation, representing farmers in Washington.

President Zippy Duvall said the aid would provide welcome relief to “farm country” taking some of the pressure off “squeezed farmers’ bottom lines”.

“We look forward to working with the president and USDA to ensure specialty crop growers, livestock producers, fishermen and others get the support they need so they can continue growing the food America’s families rely on,” he said.

However, the announcement has been met with scepticism by opposition parties in Washington.

Democrat agriculture spokesman in the House of Representatives, Angie Craig from Minesota, said farmers were only facing increased costs because of president Trump’s war with Iran and his global tariff regime.

“The fastest way for the president to provide farmers with meaningful and durable relief is to end his war with Iran and stop picking fights with our closest trading partners,” she said.

Iowa-based farmer April Hemmes, who grows about 400ha of maize and soya beans in the north of the state, said the payment would certainly help “but it isn’t an answer to high prices”.

“Although farmers welcome help, we know it keeps our input prices high,” she said.

“Diesel is an input price that we have to pay, and while it is not one of my top costs, it will increase my cost of production.”

Earlier support

The payment follows a similar aid programme, called the Farmer Bridge Assistance programme, signed off by president Trump last December and paid in the spring.

This has fed some $12bn (£9bn) in one-off payments to about 560,000 farmers across the country, to counter higher input costs and market uncertainty.

The payment worked out at about $44/acre (£81/ha) for maize, $39/acre ((£72/ha) for wheat and $83/acre (£154/ha) for oats.

The average payout was about $21,000 (£16,000) per farmer, up to a maximum of $155,000 (£116,000) per producer.