United Fresh Produce Association urges Congress to take immediate action regarding COVID-19 outbreak

In a letter sent March 21, addressed to Speaker Pelosi, Senate Majority Leader McConnell, House Minority Leader McCarthy, Senate Minority Leader Schumer, and a similar letter to USDA Secretary Perdue, United Fresh Produce Association requested Congress and USDA to consider its recommendations to specially address the food and agriculture community during this COVID-19 crisis.

According to United Fresh, the immediate impact felt by the fresh produce supply chain are:

• $5 billion for exposure for lost inventory and risk to growers

• $1 billion a week in lost sales

• Tens of thousands employee furloughed

United Fresh requested the following:

Fresh Produce Supply Chain Stabilization Program

• Over the next 30 days, implement expedited approval process for new USDA Food Vendor Program applicants whose primary business include restaurants, hotels, schools, and universities.  After 12 months, those companies that were approved under the expedited process and wish to continue being an approved USDA food vendor must reapply through the normal USDA vendor application process.

• Food service distributors, who qualify under an expedited vendor approval process would be eligible to distribute current inventories immediately through federal feeding programs.  While some are using retail channels to utilize their current supplies, most inventory currently sitting and waiting for a “customer.”    

• Make DoD Fresh distribution available to all federal feeding programs, including TEFAP, schools operating under National School Lunch and Breakfast Program and Summer Feeding, and  Child and Adult Food Program (CACFP)  In addition, ensure that DoD Fresh prime vendors can rapidly make any changes to FFAVORS catalog including pricing, item additions, serving sizes and amounts, varieties, and more, to adjust to the change in distribution needs. 

• USDA and Department of Defense (DoD) should immediately make an additional $1 billion available under DoD Fresh and USDA Vendor Program to help meet the needs of schools and all emergency feeding sites that are experiencing increased demand. Notably, DoD Fresh prime vendors and fresh produce vendors are primarily small businesses that face a unique set of challenges when disruption hits. We urge USDA to take advantage of the opportunity to utilize this existing supply chain capability to meet the needs of schools, food banks, and other emergency feeding sites that are scrambling to meet the unprecedented needs of their communities – while ensuring these businesses can continue to provide employment for their workers and be in business when schools return. 

• Establish broad temporary flexibilities allowing federal feeding programs to procure commodities from all available geographic sources.

• Allow schools to convert Fresh Fruit and Vegetable Program (FFVP) funding into flexible fresh produce purchasing, including but not limited to, pre-packed boxes of fresh produce for families to last multiple days consistent with their current meal service.  

• The Cash Value Voucher (CVV) for the Supplemental Program for Women, Infants, and Children (WIC) should be increased from $9 for children and $11 for women to $15 for all participant, better aligning it with National Academy of Sciences’ recommendations, and to provide flexibility for WIC participants to purchase a more realistic supply of fresh produce for their families, while supporting farmers. 

• Make available USDA-backed loan program for food distribution businesses to address  1) difficulty in making loan payments on existing debt; 2) difficulty in paying employees or vendors; 3) difficulty in purchasing materials, supplies, or inventory; 4) difficulty in paying rents, mortgages, or other operating expenses; and, 5) difficulty in securing financing.

Grower-Shipper Market Stabilization Program

• Because of current supply chain disruptions, food distributors in the fresh produce distribution chain who serve restaurants is at a standstill.  Basically, with the closure of restaurants, hotels, and other eating establishments, food service distributors are not being paid for product delivered to their operations.  That, in turn, impacts growers who provide commodities to these entities and are not being paid by their vendors.  This could result in significant PACA claims that could well get into the $100s of millions if not billions and cause a monumental disruption in the supply chain.  We would request that USDA PACA Division consider posting general information to the industry about their rights and responsibilities under PACA and where there can be flexibility in extending payment terms without losing their PACA Trust rights. 

• Establish a $1 billion fund that would be utilized to address claims filed by food service distributors who have outstanding expenditures to grower-shippers. Based on submission and verification of these claims by food service distributors the fund would allow USDA to reimburse grower-shippers directly based on these approved claims.

• Similarly, USDA should include $100 million in funding for State Departments of Agriculture which could be facilitated through the Specialty Crop State Block Grant Program.  Funding would be targeted to assist growers and specialty crop companies that experience unique and unexpected conditions due to the COVID-19 pandemic. For example, this could facilitate State Departments of Agriculture purchasing protective health equipment such as gloves, masks, and sanitation products needed by the grower-shipper workforce. We support temporarily changing any necessary underlying legislation to support this effort. 

• USDA should consider this opportunity to establish a Pilot Crop Insurance Program to protect growers in the event of a food safety, government quarantine, or business disruption such as a pandemic. This has been a long sought-after risk management tool for the fresh produce industry.

To learn more about United Fresh, click here.