Is there a need for a referendum on the soybean checkoff?

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Farm Forum

Conditions are far from perfect this spring as fertilizer trucks, planters and air seeders are redeployed to fields. As caretakers of the soil, farmers take pains to carefully drop seeds into the still-cold loam. Last night, I saw the lights of rigs scurrying across fields late into the night. All know that a rain can stop the progress in an already delayed planting year.

One farmer called me, concerned that at the busiest time of the year, soybean farmers are being notified that they can request a referendum on the Soybean Promotion and Research Program during a four-week period, from May 5 through May 30.

They can only ask for the referendum if they grew soybeans and paid the checkoff fee between Jan. 1, 2012, and Dec. 31, 2013. The process requires eligible producers who want to support a referendum to get a form by mail, by fax or by visiting their nearest Farm Service Agency office.

Bean growers know that the soybean checkoff is a mandatory assessment of 0.5 percent of the market price for soybeans sold by the farmer. Half of this amount goes to the national soybean checkoff and the other half to the state checkoffs.

According to a news release, if the USDA determines that at least 10 percent of the nation’s 569,998 soybean producers have requested a referendum, a referendum will then be held within one year from that determination.

As each bushel of beans is sold, farmers have gotten used to having this amount subtracted from their check and figure it’s a cost of doing business.

How likely is a referendum to happen?

History of the checkoff

Within the framework of the checkoff is a provision that allows producers a chance to request a referendum every 5 years. The Soybean Promotion, Research, and Consumer Information Act was part of the 1990 Farm Bill. The program became effective on July 9, 1991 with assessments beginning Sept. 1.

After this offer was made in 2009, USDA announced that only 759 soybean producers participated — far short of the 58,918 required for a referendum. So if you are concerned, now is the time to fill out the form when there is a break in the planting frenzy.

The national program assessment was $101.4 million in fiscal year 2012. The funds are used to fund promotional and informational campaigns and to conduct research, looking to expand and improve the use of soybeans and soybean products.

An evaluation of the program was done by the Texas Agribusiness Market Research Center at Texas A&M University in 2009. They estimated a rate-of-return of $6.40 for every checkoff dollar invested.

The checkoff is basically a flat percentage tax. Half of the soybean checkoff dollars go to work at the state level – supporting marketing and research programs right where our beans grow.

Those who serve on the checkoff boards are fellow farmers who serve in a volunteer capacity. They are the ones who make the decisions about how the funds will be spent and what the focus of research projects will be. Each soybean farmer has the right to request information, ask questions, and attempt to learn where the money from the checkoff is spent. More information is available at http://www.sdsoybean.org. The board of directors would like to hear from you on how the deduction per load ought to be spent. South Dakota also has members on the national board: http://unitedsoybean.org

Do you think there should be a referendum on the soybean checkoff? That’s the question for this week’s Farm Forum poll. And if you have a comment you’d like to share about why or why not you’d like to see the measure put to a vote, leave me a message at (605) 622-2343. Hopefully, the wheels will be turning on planters, but with cell phones, you’re welcome to call when you can take a break.

Connie Sieh Groop is a writer for the Farm Forum. Email her at cgroop@aberdeennews.com