Big hurdles on farm bill "solvable": Sen. Harkin

By Russell Blinch

WASHINGTON (Reuters) - Talks to forge a new farm bill are off to a strong start but big hurdles remain before Congressional negotiators can come up with a bill that President George W. Bush will sign into law, Senate Agriculture Committee chairman Tom Harkin said on Thursday.

"The challenges are substantial but I think they are solvable," said Harkin, sounding more optimistic than leaders in the U.S. House of Representatives did on Wednesday.

Harkin, an Iowa Democrat, said Senate and House negotiators were holding daily discussions to craft a new farm law, and the administration was engaged in the process.

"We are off to a good start in a lot of our pre-conference negotiations in the farm bill," Harkin told reporters on a conference call.

The House and Senate, looking to replace the 2002 farm law which officially expired on September 30, 2007, have each voted to maintain generous direct payment rates in the current law. The Bush administration wants to reduce those payments sharply.

The negotiators are trying to hammer out a final version of the five-year, $286 billion bill that would provide supports for farmers and fund nutritional programs such as food stamps.

Rep. Collin Peterson, the Minnesota Democrat who chairs the House Agriculture Committee, sounded pessimistic on Wednesday about whether a deal could be reached. He said the White House wanted to cut as much at $15 billion in funding from the bill.

"They're looking at taking money from every part of the bill, including direct payments, payment limits, crop insurance and all kinds of different areas," Peterson told Reuters in an interview on Wednesday.