Safety-net decisions due by end of March

Friday, February 27, 2015

Farmers throughout the country are coming to the end of a nearly yearlong process to elect which federal safety-net program in which to take part -- prices loss coverage, agricultural risk coverage or a combination of the two. According to the Farm Service Agency of the United States Department of Agriculture, after gathering data on historic yields from 2008-2012 and either keeping or reallocating base acres, farmers must make a "one-time, unanimous and irrrevocable election" of PLC or ARC.

There are two options which farmers might decide on -- PLC/ARC-CO, which gives PLC or ARC payments on a commodity-by-commodity basis, i.e. corn, soybeans and wheat, among others, or ARC-IC, which must cover all commodities on a farm.

If producers chose PLC/ARC-CO, they must also make a one-time election to select which base acres on the farm are enrolled in PLC and which base acres are enrolled in ARC-CO.

PLC and ARC replace the former safety-net programs of direct and counter-cyclical payment and annual crop revenue election.

According to Dennis Stewart, a volunteer with the Lafayette County FSA, farmers would receive a set amount in a subsidy regardless of crop price or a low-yield year with DCP. PLC offers more of a sliding scale based on those two factors, he explained.

"PLC protects producers in terms of price," Stewart noted. "If the (crop) price falls they would get payments."

Producers who enroll in PLC, and also participate in additional federal crop insurance programs, may make the annual choice to buy into the supplemental coverage option, according to the FSA, which starts with the 2015 crop. SCO can cover a portion of a farmer's insurance deductible and is based on expected county yields or revenue.

Even if a farmer doesn't elect to participate in the programs, although it is highly encouraged, according to the FSA, they may still receive some subsidy, said Stewart.

"They'll get what is known as the the county plug, or the county yield average," he said.

As for the PLC program, it's one where farmers hope they don't get a payment, added Stewart.

"Every producer hopes they don't get paid, which means they had a good yield and prices. If they get paid it means prices were suppressed or they had bad crops. It fills a gap," he explained.

After completing the election process, farmers will start to enroll in his or her elected program starting in mid-April through this summer.

Editors note: Portions of this story were previously published in the Feb. 11 edition of The Concordian.