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USDA issues $4.8b in farm safety net, CRP payments

Fewer farmers are getting checks this year, and those who do will be paid less.

The U.S. Department of Agriculture plans to pay out farm safety net support of $4.8 billion in the weeks ahead. Approximately $3 billion in payments will be made under the Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) programs for the 2017 crop year, and approximately $1.8 billion will go to annual rental payments under the Conservation Reserve Program (CRP) for 2018.

“Despite a temporary lapse of farm bill authorities, farmers and ranchers can rest assured that USDA continues to work within the letter of the law to deliver much-needed farm safety net, conservation, disaster recovery and trade assistance program payments,” Agriculture Secretary Sonny Perdue said.

The ARC and PLC programs were authorized by the 2014 farm bill and make up a portion of the agricultural safety net to producers when they experience a substantial drop in revenue or prices for their covered commodities.

“These program payments are mandated by Congress, but the department has taken measures to ensure we meet our deadlines and get capital in the hands of those folks that need it most. Unfortunately, 2018 has proven to be another tough year for producers across the nation, making the timeliness even more critical. Our resilient farmers, ranchers and producers are battling more hurricanes, wildfires, droughts, floods and even lava flows,” Perdue said.

National Association of Wheat Growers president and Oklahoma wheat farmer Jimmie Musick said the program payments will provide a needed cushion for farmers during these tough economic conditions in wheat country. “Mother nature continues to be more and more unpredictable each year, demonstrating vital importance of a viable farm safety net. ARC and PLC are important safety net programs that help enable farmers to farm another year,” he said.

PLC payments have triggered for the 2017 barley, canola, corn, grain sorghum, wheat and other crops. In the next few months, payments will be triggered for rice, chickpeas, sunflower seeds, flaxseed, mustard seed, rapeseed, safflower, crambe and sesame seed. Producers with bases enrolled in ARC for 2017 crops can visit www.fsa.usda.gov/arc-plc for updated crop yields, prices, revenue and payment rates. The estimated payments are before application of sequestration and other reductions and limits, including adjusted gross income limits and payment limitations.

USDA’s Farm Service Agency (FSA) has posted maps on its website showing the payment rate ranges for wheat, corn and soybeans through the ARC-County program, as well as revenue maps for those commodities. As required by Congress in the Budget Control Act of 2011, all payments are reduced by 6.9% as part of sequestration requirements.

Farm Futures first reported on Oct. 5 that fewer farmers are getting checks this year, and those who do will be paid less.

Bryce Knorr, Farm Futures senior grain market analyst, reported that for corn, around 31% of counties received payments averaging around $37 an acre. That compares with the approximately 80% that were eligible in 2016 and received $59 per acre, on average.

“ARC-County paid off better on corn than soybeans, which was the consensus among analysts studying the program early on. While a slightly higher percentage of soybean counties received payments for the 2017 marketing year, around 34%, the average check for those getting payments will run around $26.50. Some 41% of counties got a payment on soybeans for 2016, with the average $34,” Knorr reported.

Also, this week, USDA will begin issuing 2018 CRP payments to more than 362,000 landowners to support voluntary conservation efforts on private lands. “CRP has long been a useful tool for the department to encourage farmers to take that environmentally sensitive, more unproductive land out of production and build up their natural resource base. These CRP payments are meant to help encourage land stewardship and help support an operation’s bottom line,” Perdue said.

 

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