[Archived] Coronavirus Food Assistance Program 2 for Tobacco Producers

Agriculture Secretary Tom Vilsack announced on March 24 the U.S. Department of Agriculture will begin providing additional financial assistance to farmers, ranchers, and producers impacted by COVID-19 market disruptions. Resources for these payments were approved by Congress in fiscal years 2020 and 2021.

The original application period for CFAP 2 was September 21 through December 11, 2020. USDA re-opened CFAP 2 signup for all eligible producers beginning April 5, 2021. All new or modified CFAP 2 applications are due by October 12, 2021. Learn more at farmers.gov/cfap.

Tobacco Eligibility

Tobacco is eligible for CFAP 2. 

CFAP 2 payments are available for eligible producers of tobacco, which is categorized as a sales commodity. Payment calculations will use a sales-based approach, where tobacco producers are paid based on five payment gradations associated with their 2018 or 2019 sales.

CFAP 2 Payments for Tobacco

Tobacco is a unique commodity in that payments under CFAP 2 are not authorized through the Commodity Credit Corporation (CCC) Charter Act, but instead through the authority of the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

FSA updated the CFAP 2 payment calculation for tobacco to account for crop insurance indemnities and payments through the Wildfire and Hurricane Indemnity Program Plus (WHIP+). This more accurately represents what a producer would have marketed if not for a cause of loss.

Tobacco is categorized as a sales-based commodity. On August 24, 2021, USDA announced an amendment to the CFAP 2 payment calculation for sales-based commodities to allow producers to substitute 2018 sales for 2019 sales. Previously only 2019 was used to approximate the amount tobacco producers would have expected to market in 2020. Giving producers the option to substitute 2018 sales for 2019 sales provides additional flexibility to producers who had reduced sales in 2019. 

Payments for tobacco producers are now calculated using the producer’s eligible sales during calendar year 2018 or 2019 plus crop insurance indemnities and WHIP+ payments received for crop year 2018 or 2019, multiplied by the applicable payment rate. This may mean a higher payment for producers.

Payments for tobacco producers who began farming in 2020 and had no sales in 2018 or 2019 will be based on the producer’s actual 2020 sales as of the producer’s application date.

Eligible sales only include sales of raw commodities grown by the producer. The portion of sales derived from adding value to the commodity, such as processing and packaging, and from sales of products purchased for resale, is not included in the payment calculation.

Example: A producer’s 2018 or 2019 sales of eligible commodities totaled $75,000. The payment is calculated as ($49,999 times 10.6%) plus ($25,001 times 9.9%) equals a total payment of $7,775.

Visit farmers.gov/cfap/apply to learn more about submitting a new CFAP 2 application for tobacco.

Additional CFAP Information

Visit farmers.gov/cfap for more information on the Coronavirus Food Assistance Program, including eligible commodities, producer eligibility, payment limitations and structure, and the latest program resources.