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www.thelandonline.com — “Where Farm and Family Meet”
THE LAND — JANUARY 21/JANUARY 28, 2022
Weigh the variables when making Farm Program decisions Eligible farm operators have from now until March 15 to enroll in the A guide to aide in Farm Program decisions for the 2022 crop year 2022 farm program at Reasons to Choose Reasons to Choose their local U.S. CROP PRICE LOSS COVERAGE (PLC) AG RISK COVERAGE (ARC-CO) Department of (Price only) (Yield and price using county yields) Agriculture Farm Service Agency offices. Eligible • Think that the final market year average • Think that the final market year average cops include corn, soycorn price will be below $3.70 per bushel corn price will be above $3.70 per bushel FARM PROGRAMS beans, wheat, oats, barFor 2022-23.(*) for 2022-23.(*) ley, grain sorghum, long 2021-22 USDA market year average estimate Final market year average price was $3.70 per bushel By Kent Thiesse grain rice, medium/short = $5.45 per bushel or lower from 2014 to 2019. grain rice, temperate CORN 2020-21 final market year average price = (Market year average price will likely be above $3.70 for japonica rice, seed $4.53 per bushel 2021-22) cotton, dry peas, len• Want price protection from $3.70 to $2.20 per • Price where ARC-CO payments would begin at tils, large and small chickpeas, peanuts, sunflower bushel (PLC has a higher maximum payment various percentage of county benchmark yield: seed, canola, flaxseed, mustard seed, rapeseed, safthan ARC-CO or ARC-IC) 100 percent benchmark yield = $3.18 per bushel flower, crambe, and sesame seed. • Feel that final county average yield in 2022 90 percent benchmark yield = $3.54 per bushel Producers can choose between the price-only Price will be above a 15 percent decline from the 80 percent benchmark yield = $3.98 per bushel Loss Coverage (PLC) and revenue-based Ag Risk county benchmark yield 70 percent benchmark yield = $4.55 per bushel Coverage (ARC) program choices for the 2022 crop production year. The ARC program choice includes • Think that the final market year average • Think that the final market year average soybean price both the county-yield based ARC-CO program choice soybean price will be below $8.40 per bushel will be above $8.40 per bushel for 2021. (which is most popular) and the ARC-IC program, for 2022-23.(*) which is based on farm-level yields. If no choice is 2021-22 USDA market year average estimate Final market year average price was above $8.40 per bushel made, the 2021 farm program choice will remain in = $12.10 per bushel from 2014 to 2020.(*) place for 2022. SOYBEANS Final 2020-21 market year average price = (Market year average price will likely be above $8.40 for Crop base acres for 2022 will remain at the same $10.80 per bushel 2021-22) levels as 2019-2021 for all crops on most farms. The • Want price protection from $8.40 to $6.20 • Price where ARC-CO payments would begin at only adjustments in base acres will be for crop acres per bushel (Higher maximum payment) various percentage of county benchmark yield: added via land purchases or land rental agreements • Feel that final county average yield in 2022 100 percent benchmark yield = $7.84 per bushel or acres no longer eligible for farm program paywill be above a 15 percent decline from 90 percent benchmark yield = $8.71 per bushel ments. the county benchmark yield. 80 percent benchmark yield = $9.80 per bushel The 2022 farm program yields on individual FSA 70 percent benchmark yield = $11.20 per bushel farm units, which were last updated in 2020, will be used to calculate potential PLC payments. The • Think that the final market year average • Think that the final market year average wheat price ARC-CO benchmark yields for 2022 are based on wheat price will be below $5.50 per bushel will be above $5.50 per bushel for 2021.(**) the olympic average Risk Management Agency for 2022-23.(**) Final market year average price was $5.50 per bushel county average yields for the 2016 to 2020 crop 2021-22 USDA market year average estimate or lower from 2015 to 2020. years. The national market year average price for = $7.05 per bushel (Market year average price will likely be above $5.50 those same years is averaged to calculate the 2022 WHEAT Final 2020-21 market year average price = for 2020-21.) benchmark price for the ARC-CO and ARC-IC pro$5.05 per bushel • Price where ARC-CO payments would begin grams. All potential ARC-CO payments will be • Want price protection from $5.50 to $3.38 at various percentages of county benchmark yield: based on data for the county that an FSA farm unit per bushel (higher maximum payment) 100 percent benchmark yield = $4.73 per bushel is located in. • Feel that the final county average yield in 90 percent benchmark yield = $5.26 per bushel Calculation formulas, etc. for the PLC, ARC-CO 2022 will be above a 15 percent decline 80 percent benchmark yield = $5.91 per bushel and ARC-IC programs remain the same as in previfrom the county benchmark yield. 70 percent benchmark yield = $6.76 per bushel ous years. PLC payments for 2022 will be made if the final market year average price for 2022 falls (*) 2022-23 market year average price for corn and soybeans is calculated from Sept. 1, 2022 to Aug. 31, 2023 and finalized on Sept. 30, 2023. below the reference price for a given crop. ARC-CO (**) 2022-23 market year average price for wheat and small grains is calculated from June 1, 2022 to May 31, 2023 and finalized on June 30, 2023. payments for 2022 will be made if the final county Reasons to choose ARC-IC (Price & Yield using Farm Yields): revenue for the year (county yield multiplied by the FSA farm units with a single crop planted in 2022 that could have very low yields in 2022, compared to 5-yr. (2016-20) average final 2022 market year average price) falls below RMA yields. the 2022 benchmark revenue for a given crop. FSA farm units with potential for low yields in 2022 in a County not likely to receive 2022 ARC-CO payments. Calculations for the ARC-IC program are the same Remember: All crops raised on an individual FSA farm unit are factored together for ARC-IC revenue calculations. as for ARC-CO, except ARC-IC uses farm-level yield All FSA farm units enrolled in ARC-IC in a State are calculated together for IRC-IC determination. data and considers all crops on a farm unit together Table developed by Kent Thiesse, Farm Management Analyst for calculation of potential payments in a given year. PLC and ARC-CO payments are paid on 85 See THIESSE, pg. 17 percent of crop base acres, while ARC-IC payments are paid on only 65 percent of base acres.
2022 Farm Program Decision Table
MARKETING
