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ARC/PLC paying on 2014 crop losses for half of enrolled farms

 

By DOUG GRAVES
Ohio Correspondent

COLUMBUS, Ohio — The new system of direct payments for agricultural producers seeking financial assistance kicks in only when prices or revenue fall below normal. That’s a big difference from the previous system that delivered funds to farmers in both good and bad years.
Nevertheless, 66,718 Ohio farmers signed up for the program – part of last year’s farm bill and known officially as Agriculture Risk Coverage-County, or ARC-County – began receiving financial aid as of Nov. 3.
ARC-County payments are calculated using the national average market-year price for a crop along with the average yield for that crop in the producer’s county. The yield data come from the USDA’s National Agricultural Statistics Service. “Because the new programs are designed as financial assistance for prices and revenues lower than normal, not all producers will receive a payment, as occurred with the old direct-payments program,” said Steven Maurer, executive director of the USDA’s Ohio Farm Service Agency (FSA).
Nationwide, farmers who are signed up with ARC-County and receiving payments this year saw a drop of $20 billion in revenue compared to the historical benchmark. Across north-central Ohio, the program is showing the greatest impact with corn revenue.
According to the state FSA, farmers in Crawford County saw corn revenue of 82.7 percent of the historic average in 2014, 87.1 percent in Richland County and 79.9 percent in Marion County. Under ARC-County, those numbers rise to 94.3 percent in Crawford County, 98.7 percent in Richland and 91.5 percent in Marion.
Soybean revenues for 2014 were steadier: 97.5 percent of the historic average in Crawford County, 107.9 percent in Richland and 99.6 percent in Marion. With ARC-County those numbers climb to 100 percent in Crawford and Marion counties and remain at 107.9 in Richland.
Wheat revenues last year in the region were all above the historic average, from 108.9 percent in Richland County to 111.7 percent in Crawford and 126.3 percent in Marion, and don’t change under ARC-County. Michigan FSA Executive Director Christine White announced approximately 56,000 Michigan farms that enrolled in the new safety-net programs have begun receiving financial assistance for the 2014 crop year. The programs, ARC-County and Price Loss Coverage (PLC), are designed to protect against unexpected drops in crop prices or revenues due to market downturns.
“Of the 83 counties in Michigan, many producers harvest corn, soybeans and wheat, and have experienced a significant drop in price and/or yield below the historical benchmark established by the ARC program,” White said.
“For growers under the PLC program, the average price for the market year was higher than the historical benchmark established by the programs, so financial assistance did not occur. Payments by county can vary because average county yields will differ.”
In Michigan, 52,433 farms participated in ARC-County and 4,956 farms participated in PLC. Across the country, nearly half of the 1.7 million farms that signed up for either program will receive safety-net payments for the 2014 crop year.
The ARC/PLC programs primarily allow growers to continue to produce for the market by making payments on a percentage of historical base production, limiting the impact on production decisions.
Nationwide, 96 percent of soybean farms, 91 percent of corn farms and 66 percent of wheat farms elected the ARC-County coverage option. Ninety-nine percent of long-grain rice and peanut farms and 94 percent of medium-grain rice farms elected the PLC option. Crops receiving assistance include producers of barley, corn, grain sorghum, lentils, oats, peanuts, dry peas, soybeans and wheat.
12/3/2015