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Safety-net payments coming for enrolled farms

Slump in commodity prices triggers payments
A look at local farmer Tom Markle’s farm in June. Some farmers who signed up for the USDA’s new Agriculture Risk Coverage or Price Loss Coverage programs will receive safety-net payments because of dropping commodity prices.

Because of a slump in 2014 commodity prices, roughly 1.7 million farms across the country that are enrolled in the USDA’s new Agriculture Risk Coverage (ARC) or the Price Loss Coverage (PLC) programs are on track to receive safety-net payments.

Created under the 2014 Farm Bill, the ARC program provides revenue loss coverage for enrolled farms at the county level. ARC-County payments are issued when the actual county crop revenue of a covered commodity is less than the ARC-County guarantee for that commodity.

Also created under the 2014 Farm Bill, the PLC program issues payments when the effective price of a covered commodity is less than the respective reference price for that commodity, according to the USDA.

According to the USDA, crops receiving assistance include barley, corn, grain sorghum, lentils, oats, peanuts, dry peas, soybeans and wheat.

State FSA representative Tammy Cook noted that a clear picture of localized data on per-county safety-net payment rates was forthcoming.

“Unlike the old direct payments program, which paid farmers in good years and bad, the 2014 Farm Bill authorized a new safety net that protects producers only when market forces or adverse weather cause unexpected drops in crop prices or revenues,” said Agriculture Secretary Tom Vilsack.

“For example, the corn price for 2014 is 30 percent below the historical benchmark price used by the ARC-County program, and revenues of the farms participating in the ARC-County program are down by about $20 billion from the benchmark during the same period. The nearly $4 billion provided today by the ARC and PLC safety-net programs will give assistance to producers where revenues dropped below normal.”

Nationwide, 96 percent of soybean farms, 91 percent of corn farms, and 66 percent of wheat farms elected the ARC-County coverage option, according to the USDA.

Overall, 76 percent of participating farm acres are protected by ARC-County, 23 percent by PLC, and 1 percent by ARC-Individual.



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