Illinois farmers and ranchers received nearly $2 billion in federal aid during the federal fiscal year ending Sept. 30, 2005, a time marked by depressed grain prices and record corn and soybean supplies.
About $1.3 billion was given to Illinois farmers in the form of direct payments and $562 million in loans were issued during fiscal year 2005.
The numbers do not include any payments made from October to December 2005, when many loan deficiency payments, or LDPs, were made, said Joe Alexander, public affairs specialist with the Illinois Farm Service Agency in Springfield. LDPs are calculated by the difference between the local cash grain price and the government loan rate, which fluctuates.
McLean County farmers received the most subsidies with a total of $44.5 million, followed by Iroquois County with $41.4 million, Livingston with $38.7 million, and Champaign $36.6 million. Vermilion County farmers got $25.6 million.
The number of farms and farmers in Illinois may be small relative to other industries (according to the most recent Agricultural Census in 2002 there were 73,000 farms in the state), but the "economic force of agriculture is great," Alexander said.
"In places like Ford County, Piatt, Douglas and DeWitt counties, (agriculture) is a large economic driver," Alexander said.
Take away the farm payments and there could be significant loss to local economies, he said. A farmer's subsidies may cover seed costs, fertilizer, machinery and other purchases, including food at the local grocery store, Alexander said.
In addition to the $1.3 billion in direct payments and $562 million of loans, about $117 million was paid to Illinois landowners for conservation activities.
The bulk of the conservation money came via the federal Conservation Reserve Program, which pays landowners if they enroll acres into programs for 10- or 15-year periods.
The amount of federal money spent on conservation has been steadily increasing in recent years, Alexander said. Conservation spending in fiscal year 2004 was $115.6 million and $113.2 million in fiscal year 2003.
The Illinois Farm Service Agency published the figures in its annual report, now available on its Web site, www.fsa.usda.gov/il. The agency has always compiled an annual report, but this is the first time it has been organized into a PowerPoint presentation and has been so easily accessible to members of the public, Alexander said. The goal was to let people know what the agency does.
Many people know the University of Illinois is a major employer and it is considered an economic force in the region, but not everyone may realize agriculture's impact, Alexander said.
"I don't think any farmer likes the subsidies," said Indianola farmer Doug Miller. But if you eliminated subsidies, "most farms would be unprofitable or they'd break even at best," he said.
"The issue is we produce so much grain. We have to export it. We don't have a level playing field. We think our subsidies are bad, but they're a fraction of what the (European Union) countries and Japan pay their farmers," Miller said.
"The U.S. is under a lot of pressure to become WTO (World Trade Organization) compliant," said Katie Danko, Illinois field organizer for Oxfam America. Oxfam supports the reduction or elimination of trade-distorting subsidies, subsidies linked to price and production and determine the world price for a commodity, she said.
"Someone's got to take the first step," she said.