Dollars for Double-Croppers

May 3, 2022

Anna Moneymaker/Getty Images

Biden is tryin’ to keep wheat on the table and pull dollars out of the grocery bill in one fell swoop.  

His request to Congress calls for a cool $500M to offset rising costs and food shortages related to the war in Ukraine.

The skinny: Under the proposal, double-cropped wheat would gain a $10/acre incentive, paid out through crop insurance premiums. Loan rates would also increase for crops like wheat, rice, soybeans, and oil, giving growers more time to sell their crops at a higher profit. 

The government says the program could replace up to 50% of Ukraine’s usual wheat exports. 

ICYMI (somehow): Together, Russia and Ukraine make up nearly 30% of global wheat exports. They also export a significant amount of fertilizer. The war has strained already tight fertilizer stocks and sent global grain prices soaring. 

Looks good on paper: The proposal has been met with some serious skepticism—not from Congress or political foes, but from those it’s designed to help. Some farmers say the market is currently creating its own incentives. And while the loan rate increases might be aimed at mitigating swollen input costs, the program numbers don’t quite pencil out. 

“If you’re looking at $17 beans, why would you want to put grain under loan at $8? It’s a liquidity issue that’s market distorting,” says ProFarmer policy analyst Jim Wiesemeyer. 

Tangent: Ukraine is now playing Where’s Waldo Wheato. Their deputy ag minister is accusing Russia of getting sticky-fingered with grain from silos in occupied territory, to the tune of 1.5M tonnes. The Kremlin denied responsibility for the missing wheat.