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Texas A & M Analyzes Trade Aid Distribution

Texas A & M University published its analysis of the Trump administration’s trade aid program. 

The study’s authors say, “There’s no denying that the trade aid package, especially the Market Facilitation Program, has had a significant impact on farm income in the U.S.” 

Across all of the Agricultural and Food Policy Center’s 63 representative crop farms, the two years of MFP payments in 2018 and 2019 protected $16.4 million in net worth from 2018-2020.

Under baseline conditions without MFP, 35 of those 63 farms had a greater than 50 percent chance of ending 2020 with negative cash balances. 

With the MFP in place, the study says the number dropped to 34 percent. 

Some have argued that the second round of payments was biased toward Southern states. 

Most of the variability in county payment rates under MFP can be explained by the underlying damage assessments and the distribution of planted acres in the respective counties. 

The study authors say even though the highest county payment rates were mostly in counties with cotton production, almost 70 percent of the MFP payments went to producers in Midwestern states. 

“We find little validity to the argument of regional inequity,” the authors said in a statement.


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