The farmer-owned reserve after eight years: A summary of research findings and implications

The Farmer-Owned Reserve Program (FOR) was inaugurated in April of 1977 by Secretary of Agriculture Bergland under the authority of existing legislation. Congress followed suit by specifically adopting FOR provisions for wheat and feed grains in the Food and Agricultural Act of 1977. Although the government had owned large stocks of grains and fibers in the 1950s and 1960s, the FOR was the first deliberate effort in the history of U.S. agriculture to establish a stabilization stocks program. Since its inception, the FOR program has been at various times praised and damned by farmers, policy analysts, and policymakers. It has been seen at times as a force controlling fluctuations in commodity supplies and price and at times as a force out of control. Regardless of whether it is viewed as a good or poor policy instrument, there is no question that the FOR program has had a substantial influence on commodity markets and policy. Figures 1.1 and 1.2 show the rapid growth of the FOR and its variability in response to market and policy conditions. During the last 5 years, members of the North Central Regional Research Project NC-169 have been reviewing the evidence on the FOR and evaluating the performance of this new and rather innovative policy instrument. Although the program is new relative to many other commodity program provisions, it is an appropriate time for a thorough review of the evidence on its performance