It was a quick follow-on to the stiff opposition from farm-state members of Congress in February, when the cuts were first proposed.

Nonetheless, Obama is sticking by the proposal on direct payments, which his budget officials said will save $US9.7 billion in the next 10 years.

In addition, he has remained determined to cap total farm payments at $250,000.

The President's budget proposes to phase out direct payments over a three-year period for farmers with sales of $500,000 or more, noting that those payments were added in the 1996 Freedom to Farm bill as temporary, "transitional payments".

Obama's proposal is much further-reaching than one the Bush Administration suggested during the farm bill debate that would have used $500,000 in adjusted gross income - rather than sales revenue - as the threshold.

The Obama budget plan explains that about 9.1pc of farms collecting government payments have sales of $500,000 or more, and "they collect 36.6pc of all government payments (including conservation payments). Not all of these farms would lose their direct payments under the" new plan.

According to the budget plan, "The proposal is targeted to the farmer, not the farm, and many of these farms have more than one person farming the land."

When the proposal made its first appearance in the February draft, Republican Senator Mike Johanns was quick to point out the difference between basing the threshold on sales revenue versus adjusted gross income. (In his previous role as agriculture secretary, Johanns led the Bush Administration's effort to insert an adjusted gross income threshold of $US500,000 into the 2008 farm bill.)

The Obama plan, Johanns said, "gives no consideration to the level of need for a safety net. A farm with $500,000 in gross sales might also have $600,000 in input, production and transportation costs."

In a statement just after the February budget announcement, he estimated that 76,500 farms would see cuts to direct payments under the proposal.

In a second budget cut to farm program recipients, Obama seeks to cap market assistance loan gains at $145,000 per person.

If the Administration is successful, that would cap farm program payments at a total of $250,000 per person - an issue Congress said in February would not fly.

The budget proposal projects $US63.7 million in savings over 10 years.

(Currently, direct payments are capped at $40,000 per person, and countercyclical payments are capped at $65,000. If the Administration succeeds in capping marketing loan gains at $145,000, that brings the total to $250,000 per person.)

Among other provisions in Obama's fiscal 2010 budget are:

• A 20pc reduction in funding for the Market Access Program, which helps support US agricultural exports. The budget proposal cites overlaps with other trade promotion programs and notes that "large, for-profit entities indirectly benefit" from the program, causing it to be singled out as "an example of corporate welfare."
• Eliminating cotton storage credits for a savings of $570 million in 10 years. The credits allow producers to store their cotton at the government's cost until prices rise, but that could mean "producers may store their cotton for longer than necessary," the budget says.
• Eliminating the U.S. Department of Agriculture's Watershed & Flood Prevention Operations program, which the White House complains has been so earmarked in recent years that USDA has been "unable to prioritize projects on any merit-based criteria, such as cost-effectiveness."
• D iscontinuing Conservation Reserve Program incentive payments for landowners who enroll in state hunting public access programs. The proposal estimates savings at $22 million over 10 year and says the payments "duplicate existing funding for these state programs."
• Eliminating USDA's Resource Conservation & Development program, which was begun in 1962 and which the Obama budget team now says has "outlived its need for federal support."
• Consolidatin g USDA office space in Washington, D.C., "under one roof." The agency's offices currently are spread out in several buildings leased for the General Services Administration.