According to Reuters, the direct payments will go to producers affected by COVID-19 and mass purchases of meat, dairy vegetables and other farm products.

The USDA is partnering with regional and local distributors to purchase $3 billion of farm goods that will be earmarked for foodbanks, churches and aid groups to meet rising demand as millions of Americans face unemployment and economic uncertainty.

"American agriculture has been hard-hit, like most of America, with the coronavirus, and President Trump is standing with our farmers and all Americans to make sure that we all get through this national emergency," Agriculture Secretary Sonny Perdue said at a White House news conference.

The agency said it will make monthly purchases totalling about $100 million each of fresh produce, dairy products and meat products. Perdue said USDA will work with companies like Sysco Corp to help procure, package and distribute food boxes.

US food banks have experienced surging demand in recent weeks.

Given the economic disruption caused by the pandemic, farmers and ranchers have struggled to bring their goods to market. Many have been forced to dump what they have produced and call for government assistance.

"Having to dump milk or plow under vegetables ready to market is not only financially distressing but it's heartbreaking as well for those that produce them," Perdue said.

Direct payments will be sent "as quickly as possible" as farm commodity producers have experienced "unprecedented losses," Perdue said, who hoped checks could be sent by the end of May.

The $16 billion in direct payments to farmers and ranchers will include $9.6 billion for the livestock industry - with $5.1 billion for cattle, $2.9 billion for dairy and $1.6 billion for hogs, according to a statement released late Friday by US Senator John Hoeven of North Dakota, chairman of the Senate Agriculture Appropriations Committee.

In addition, $3.9 billion will be paid to row crop producers, $2.1 billion for specialty crop farmers and $500 million for other crops, according to the statement. The payments are capped at $250,000 per individual farmer or entity.

Perdue acknowledged that constituents may consider the direct payments "insufficient” and said USDA is trying to cover "small farmers as well as larger farmers.”

Funding for the immediate aid programme will be pulled together from a number of sources, including recent coronavirus-related aid laws passed by Congress and other funding authorities that USDA has access to, according to Perdue.

But going forward, he said, "I anticipate we will need additional money."

The NFU response

The National Farmers Union (NFU) issued a press release shortly after the aid programme was announced, welcoming the news.

The NFU had recently sent a letter to Secretary Perdue, highlighting the significant financial pressures family farmers and ranchers are enduring as a result of the pandemic. The letter urged him to, “swiftly and efficiently implement assistance and distribute resources.”

Following the USDA’s announcement, NFU President Rob Larew expressed appreciation for the agency’s efforts to provide much-needed relief and reiterated importance of dividing aid fairly and establishing longer-term solutions to market challenges:

"In good times and bad, family farmers and ranchers work tirelessly to put food on our tables. But right now, they are facing immense challenges. Critical markets have evaporated overnight, demand has shifted dramatically, processing facilities have halted operations, and commodity prices have cratered – all of which are cutting into already-thin margins. Without immediate assistance, many more family farms could be forced out of business, which would devastate rural communities and threaten our food supply.

“We appreciate the administration’s commitment to help farmers weather this storm. To ensure the most effective use of these funds, payments must be commensurate with demonstrated need, and should be implemented in conjunction with policy that addresses fundamental market challenges. Failure to do so will result in the further consolidation of America’s farms, which will weaken our national food security."