WASHINGTON, D.C. — The National Grain and Feed Assoc. (NGFA) has sent a second letter to the USDA, asking acting-Secretary Chuck Conner to reconsider his decision not to allow penalty-free early release of some lands enrolled in the Conservation Reserve Program (CRP).

In its second letter, dated mid-October, the NGFA said the decision to “stay the course … may expose land with the highest environmental benefit rankings to being removed from the CRP as the market aggressively prices grain to ration tight supplies.”

According to the letter, 4.3 million acres of land re-enrolled last year under new 10- to 15-year CRP contracts ranked highest using the USDA’s Environmental Benefits Index.

Those acres are subject to a much lower economic penalty if removed from the CRP early and returned to production, than land with far lower environmental benefits extended under two- to five-year CRP contracts.

Under CRP rules, the letter said, land reenrolled last year could be restored to production between now and September 2008 with a penalty of 25 percent of the annual CRP rental rate. Land extended two to five years, however, is subject to a penalty of 100 percent of the rental rate, over multiple years covering the original CRP contract and the renewed contract period, plus interest and liquidated damages.

The letter questions whether the USDA “wants these acres to come from CRP lands that can be farmed in an environmentally sustainable way or risk having more environmentally sensitive lands being drawn into production by immediate economic pressures.”

Conner, named acting secretary in September after former secretary Mike Johanns resigned, announced late that month his decision to deny the NGFA’s first request.

“While this year’s global wheat market remains very tight, corn production is expected to be record-high, and today’s grain stocks report indicated higher than expected stocks for corn and soybeans at the start of the 2007-08 crop year,” Conner said in a statement. “Overall, I expect that market signals will continue to provide adequate acres, recognizing that strong competition among crops is likely,” he said.

Conner probably won’t let his status as acting director hinder the announcement of a decision, said Randy Gordon, vice president of communications and government relations for NGFA.

“The first time, Mr. Conner made the decision pretty quickly after taking over,” Gordon said. “He’s not letting that stand in the way. ” Conner likely won’t make a decision until he looks at more recent crop reports, Gordon said. “We hope our second letter will give him pause,” he said. “It’s a very tight and precarious stock situation.”

The USDA occasionally receives requests from different groups asking it to allow early release of CRP lands, said John Johnson, Farm Service Agency deputy administrator for farm programs. “Even if we did try to release some, the impact would be negligible on the price of grain,” he said. “Current contract holders would not take an early out. I don’t think the participation would be that high, because they appreciate the conservation aspects of the program.”

Land is released from the CRP each year, Johnson said. More than 12 million acres will come out of the program by 2010 as current contracts expire. At the end of September, 2.5 million acres were released, he said.

In its first letter to then-Secretary Johanns, the NGFA said the early release was needed to avoid what the organization called significant commodity supply/demand challenges next year. Four million to five million more acres of corn, soybeans and wheat would need to be planted next year than were planted in 2007 to avoid supply disruptions for the United States’ domestic and foreign customers, the letter said.

Not every member of the NGFA supports the early release of CRP land. The National Farmers Organization (NFO) said recently it is disappointed by the NGFA’s position.

“We believe their public reason to protect environmental land is simply a cover for their desire to bring more land into production, which would, in fact, lower prices farmers receive for their grain,” said Gene Paul, NFO ag policy analyst.

“Dumping potentially millions more acres into production when the grain market is positive, and during a time of uncertainty about the farm bill, is unwarranted, if not irresponsible.”