The National Potato Council urged its members to apply this week for COVID-19 aid while it works to increase Agriculture Department payments to potato growers and tries to sell Congress on a plan to buy USD300m of surplus spuds.

The USDA began taking applications for USD16bn in direct payments to farmers and ranchers adversely affected by disruptions to the economy related to the pandemic. Kam Quarles, CEO of the National Potato Council, said his association told members to sign up “to keep their options open” while the organization makes the case to the USDA to change its assessment of the impact COVID-19 has had on the industry. Quarles said one glaring oversight in the current USDA payment program is the exclusion of seed potatoes that are used to start potato crops.

“Seed potato growers are the tip of the spear on every crop. Our seed potato producers are being told they are ineligible and can’t sign up,” Quarles said.

About 40% of farmers who raise white potatoes supply retailers like grocery stores with chips and fresh potatoes, while 60% grow for processors who sell French fries, tater tots and dehydrated potatoes to institutional buyers, Quarles said. In 2018, farmers grew 44 billion pounds of the popular vegetable.

Quarles said he thinks the organization is making headway with the department, citing the USDA’s May 4 announcement that it will use its Section 32 commodity-purchasing authority to buy USD50m of potato products along with USD420m of other surplus crops. Section 32 refers to a provision of the 1935 legislation that authorized the program. The association wants to see payment bumped up from 1 cent per pound, for potatoes that growers could not ship to commercial customers. Those buyers were contending with an oversupply of potatoes caused by a sharp drop in demand by restaurants and other food service outlets as business declined because of public health stay-at-home orders.

Quarles said the association thinks at least 4 cents per pound, which would be comparable to the rate for sweet potatoes, would be fairer.

The association also wants potatoes made eligible for direct payments under a category that recognizes market price declines of 5% or more tied to COVID-19’s effects on the economy.

Even with a higher payment rate, Quarles said the National Potato Council calculates that the industry needs USD300m in USDA potato purchases to help reduce the backlog and stabilize market prices. The association would like to see the funding included in the next economic relief bill.

“Congress is going to have to step in and provide more resources.” he said.

The 2019 crop was harvested in October and would usually last processors until August, but Quarles said buyers are telling his members that they believe they will need far less of the 2020 harvest. Most potato farmers plant from late March through April, although planting continues in Maine and North Dakota.