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The Chairman of the House Agriculture Committee said on Sunday he is optimistic Congress can reach an agreement on farm bill spending this week, but added that a short-term extension of the current law may be needed to allow for further negotiations with the Bush administration.

"I think we'll get this worked out this week," Minnesota Democrat Collin Peterson told the National Farmers Union convention by telephone. "My guess is we'll have to extend the current law one more month," until April 15 to settle the final disputes on the law and pass it.

House and Senate negotiators are close to an agreement that would boost farm bill spending by $10 billion over the 10-year baseline budget, and would include some money for a new permanent disaster aid program. However, key lawmakers missed a Friday deadline for coming up with budget offsets to pay for the agriculture spending increase.

Peterson was scheduled to attend the NFU convention, but had to stay in Washington because of the spending negotiations.

According to Peterson, the Bush administration said in a letter this weekend that it would support the $10 billion increase over 10 years, up from its previous offer of $6 billion, but only if the new farm bill put tighter constraints on government subsidies.

The Bush administration suggested spending controls on health care and jobless programs to offset the increase, but lawmakers preferred other, more palatable, sources of revenue, such as customs fees, Peterson said.

That stance is consistent with comments made by Agriculture Secretary Ed Schafer at Commodity Classic on Friday.

"USDA supports a $6 billion level," Schafer told attendees of the annual grain conference. "We understand that we're likely to see an increase in there as the Senate looks at their needs and priorities. The administration, myself personally and USDA are not willing to look at increased spending if it's not generated by reforms. We cannot have increased spending without reform."

Editor’s note: Richard Brock, The Corn And Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.