SMHPP Payments Going Out

USDA Sending Out Pandemic Payments to Independent Pork Producers

Chris Clayton
By  Chris Clayton , DTN Ag Policy Editor
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After some delays and confusion earlier this year, USDA is finally sending out $62.8 million in payments to independent pork producers who sold their hogs through a spot market sale during the early part of the pandemic. The payments will come to $54 per head. (DTN file photo)

OMAHA (DTN) -- Going back to 2020 when independent pork producers saw depressed prices because of packing-plant shutdowns, USDA on Tuesday announced new funding and full payments to pork producers under the Spot Market Hog Pandemic Program.

The Spot Market Hog Pandemic Program (SMHPP) will pay producers $54 per head for hogs sold through a spot market sale from April 16, 2020, through Sept. 1, 2020. The SMHPP payments will be limited to up to 10,000 head per producer. Payments to pork producers should start going out this week.

USDA stated the Farm Service Agency expects to issue roughly $62.8 million to pork producers under SMHPP, which translates into payments for about 1.16 million hogs marketed by producers during that April-September 2020 timeframe. There is no payment limit per person or legal entities under SMHPP.

FSA had accepted applications for the program through April 29, 2022.

USDA had originally planned to calculate payments based on $50 million allocated for the program, but Agriculture Secretary Tom Vilsack opted to increase funding by $12.8 million for producers to receive the full $54 per head payment.

"In order to provide more targeted support to hog producers affected by the pandemic, FSA was able to increase funding for SMHPP to provide full payments to producers instead of applying a payment factor," said FSA Administrator Zach Ducheneaux. "We are pleased to be able to provide more equitable opportunities for hog producers who were hard hit by the pandemic."

At least some lawmakers had complained about the time it was taking for USDA to release funds under the program. There also had been a lot of confusion earlier this year in defining exactly who was eligible under a "spot market sale" and hogs under the program.

While the application deadline is closed, more details on the SMHPP can be found at….

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Chris Clayton