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Changes await Texas farmers in 2018 Farm Bill programs


By Jessica Domel

The program names may have stayed the same, but there have been changes to the two main farm bill safety net programs, Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC).

Not all farmers who were eligible for ARC and PLC through the 2014 Farm Bill will be eligible through the current bill.

“If it (the farm number) wasn’t planted at least a tenth of an acre to a program crop at any point in time between 2009 and 2017, it will not be eligible for ARC or PLC in this farm bill,” Dr. Joe Outlaw, co-director of the Agriculture and Food Policy Center at Texas A&M University, said in an interview with the Texas Farm Bureau (TFB) Radio Network.

As a result, some farmers who planted grass and have allowed their cattle to graze it will not be eligible.

Instead, if the acreage is certified through the U.S. Department of Agriculture’s (USDA) Farm Service Agency (FSA), it will be eligible for a new grassland program that will pay $18 per acre for the life of the farm bill.

Through the new farm bill, PLC fixed reference prices may float higher based on the Olympic moving average price up to 115 percent of the statutory reference price, providing greater support to farmers in difficult years.

Plug prices under ARC are also allowed to float.

According to the American Farm Bureau Federation, benchmark prices can be no lower than the maximum of the statutory reference price or 85 percent of the Olympic moving average.

Plug yield in ARC benchmark revenue calculation will be no lower than 80 percent of the county’s transitional yield, which increases the benchmark revenue guarantee for many areas.

USDA’s Risk Management Agency (RMA) trend-adjusted yield factors will be incorporated into benchmark and yield calculations for those in the ARC program.

RMA data will become the primary source of yield data to improve the integrity of the program.

Unlike the 2014 Farm Bill, cotton is now a Title I covered commodity and eligible for ARC and PLC.

“Luckily, cotton was handled in the Bipartisan Budget Act, which was passed last March,” Outlaw said. “They put cotton back as a covered commodity, and then doing so, that made it where if we had a farm bill or even if we didn’t have a farm bill, cotton was going to be covered in an extension type framework.”

ARC or PLC eligible farmers now have the ability to change programs if the program they’re signed up for isn’t working for their farm.

“They’re going to select this year for ’19 and ’20. So the first decision is a two-year decision,” Outlaw said. “In ’21, ’22 and ’23, they can change between ARC and PLC each year.”

The new farm bill also allows for updates to yields.

“This is a big deal for Texas,” Outlaw said.

In 1985, most bases and yields were frozen. Since then, there have been two opportunities to update yields—the 2002 and 2014 farm bills.

“Each of those used a period of years to update yields that had drought years in it for Texas,” Outlaw said. “Whenever you have a drought, your yield is near zero. If you’ve got five years of yields and one of them is zero, that means it’s not very high yield.”

The ability to update yields will begin with the 2020 crop for PLC, which the majority of Texans have used in the past.

“Producers need to analyze it for their own operation, but we will primarily be PLC because of the way our prices are right now,” Outlaw said.

Sign up for ARC and PLC is expected to begin Sept. 1.

FSA is currently preparing to implement the new, five-year farm bill, according to Gary Six, Texas FSA executive director.

“We didn’t totally revamp it, but we did just enough to improve on it, and we’re getting geared up and excited for it,” Six said.

Six told the TFB Radio Network farmers who have questions about which program is best for them should visit their local FSA office.

Outlaw said the AFPC will once again be available to help farmers decide which program will best fit their farm. A decision aid will also be available on their website at www.afpc.tamu.edu.

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