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Federal government ups spending to reduce surplus foods, shore up markets

SD Ag Connection - May 5, 2020

WASHINGTON, DC - U.S. Agriculture Secretary Sonny Perdue announced details of $470 million in Section 32 food purchases to occur in the third quarter of fiscal year 2020, in addition to purchases previously announced, which will enable USDA to purchase surplus food for distribution to communities nationwide. These Section 32 purchases will provide additional support for producers and Americans in need, in response to changing market conditions caused by the COVID-19 national emergency.

"America's farmers and ranchers have experienced a dislocated supply chain caused by the Coronavirus. USDA is in the unique position to purchase these foods and deliver them to the hungry Americans who need it most," said  Perdue.

The Agricultural Marketing Service will purchase a wide variety of fruits, vegetables, meat, dairy and seafood products. Specific purchase amounts for each commodity are included in the chart below. Purchases are determined by industry requests, market analysis and food bank needs. AMS will begin issuing solicitations in June and intends to begin deliveries in July.

Details on how vendors may participate are available on the Selling Food to USDA page on the AMS website. Solicitations will be posted to the AMS Open Purchases Request website once available.

Industry requests for future purchases using Section 32 funds, including potential plans for the fourth quarter of fiscal year 2020, will be assessed on an ongoing basis.

Commodity – Amount
Asparagus -- $5 million
Catfish Products -- $30 million
Chicken -- $30 million
Dairy Products -- $120 million
Haddock, Pollock, Redfish (Atlantic) -- $20 million
Orange Juice -- $25 million
Pears -- $5 million
Pollock (Alaska) -- $20 million
Pork -- $30 million
Potatoes -- $50 million
Prunes -- $5 million
Raisins -- $15 million
Strawberries -- $35 million
Sweet Potatoes -- $10 million
Tart Cherries -- $20 million
Turkey Products -- $50 million

The National Milk Producers Federation announced there will be an additional  $120 million of cheese and butter among  $470 million in Section 32 food purchases. The purchases are scheduled to occur in the next two months and are in addition to purchases previously announced in the CARES Act funding.

On an ongoing basis AMS purchases a variety of domestically produced and processed agricultural products as authorized by Section 32 of the Agriculture Act of 1935. These "USDA Foods" are provided to USDA's Food and Nutrition Service (FNS) nutrition assistance programs, including food banks that operate The Emergency Food Assistance Program (TEFAP), and are a vital component of the nation's food safety net.

In addition to Section 32 purchases, USDA will use other available funds to purchase food in support of American agriculture and families on an ongoing basis and in response to recent disruptions in the food-supply chains.

The U.S. food industry is experiencing high inventories due to a decrease in demand as foodservice establishments, restaurants and schools have been closed and prices producers typically receive have declined.

Meanwhile, food banks, food pantries and other organizations supporting communities across the country have experienced an increase in demand.

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Sturgis, SD 57785