Proposed USAID Cuts Could Disrupt Louisiana Rice Farmers' Export Market

USAID Workforce Cuts Threaten Louisiana Rice Farmers' Export Channels

Louisiana's rice industry faces uncertainty as proposed reductions to the U.S. Agency of International Development (USAID) could disrupt vital food aid programs. The potential overhaul comes amid efforts by former President Donald Trump and ally Elon Musk to significantly downsize the agency.

Michael Fruge, a seasoned farmer and proprietor of Parish Rice in Eunice, highlighted USAID's overlooked significance in agricultural discussions. "They talk about Mexico because it changes," Fruge explained. "They talk about India because they put export bans on long grain rice. But food aid has just been there. It just hasn't been talked about because it's just there."

USAID has been a cornerstone of U.S. food aid since 1968, facilitating programs that distribute millions of pounds of rice worldwide. Earlier this month, Trump and Musk initiated layoffs affecting thousands of USAID employees and suspended numerous international assistance programs. However, a federal judge intervened on Friday, issuing a restraining order that temporarily halts plans to reduce USAID’s workforce from 10,000 to fewer than 300 employees. Despite this, key programs that provide billions of dollars to U.S. farms remain frozen, posing risks for farmers in Louisiana.

The state's rice growers are integral to programs like Food for Peace and McGovern-Dole International Food for Education and Child Nutrition. Rice from Louisiana is exported globally, reaching nations such as Haiti, Iraq, and Ukraine through ports in Houston and New Orleans.

According to Michael Klein of the USA Rice Federation, food aid ranks among the top ten purchasers of rice in the United States. In 2024 alone, USAID bought over $126 million worth of American rice, valued for its high caloric content and long shelf life. Although precise figures on Louisiana’s rice exports to USAID programs are unclear, the state remains a leading rice producer with approximately 75% of its rice acreage located in Acadia, Jeff Davis, Vermilion, Evangeline, and St. Landry parishes.

"The reality is we just don't even know the full extent of what is happening," Klein stated. "It's concerning, but we just don't know how it's going to impact the industry as a whole or Louisiana specifically."

Significant investments from USAID have been directed to major rice milling operations in Louisiana, including Supreme Rice in Crowley and Farmers Rice Milling Company in Lake Charles. Despite these ties, David Warrington, CFO of Powell Group (owner of Farmers), confirmed that his company currently holds no contracts with USAID. Similarly, Supreme Rice CEO Bobby Hanks did not respond to requests for comment. Both CEOs have previously defended food aid programs, with Hanks citing former Secretary of Defense James Mattis: "if goodwill programs like these are not fully funded, 'then I need to buy more ammunition,'" as noted in a USA Rice press release.

State Rep. Troy Romero, a Republican from Jennings and chair of the agricultural committee, is actively working to safeguard Louisiana rice's involvement in USAID initiatives. "When (the Trump administration) looked into USAID, they found that numerous dollars were going to some crazy things that conservatives may have a problem with," Romero stated. "They're going to reinstate the stuff that is really important. I cannot imagine that program—as good as it is—would be one of the ones that they would cut out."

The dependency on exports is critical for Louisiana rice farmers. Fruge estimated that between Louisiana and Arkansas, roughly 50% of the rice crop is exported, with 5% to 10% allocated to food aid programs. Any disruption in these markets could result in oversupply and declining prices as mills seek alternative international buyers.

While Fruge acknowledged the possibility of misallocation within USAID and the necessity for reform, he expressed uncertainty about the administration's approach: "If Elon and President Trump are going to fix wasteful spending, how else do you go about it? Are they doing it the right way? I don't know. But I would like to think they're doing it the best way they know how."