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The nuts and bolts of federal farm programs

Posted on November 15, 2019 12:00 AM

By Jay Stone

Under the 2018 farm bill, producer enrollment in the Price Loss Coverage (PLC), Agricultural Risk Coverage-County (ARC-CO) and Agricultural Risk Coverage-Individual (ARC-IC) programs for contract year ’19 continues through March 15, ’20. Enrollment for contract year ’20 is also underway and continues through June 30, ’20.

Georgia Farm Service Agency Farm Programs Chief Brett Martin reviewed changes made to the PLC, ARC-CO and ARC-IC programs under the ’18 farm bill during a series of meetings in early October. The meetings also addressed crop insurance, trade assistance and disaster assistance.

The ARC programs provide payments when actual crop revenue drops below specified guarantee levels for 22 commodities. PLC covers losses when prices for covered commodities fall below established prices.

The covered commodities include seed cotton, peanuts, corn, soybeans, wheat, oats, barley, grain sorghum, dry peas, lentils, sunflower seed, canola, flaxseed, mustard seed, rapeseed, safflower, crambe and sesame seed.

Martin said a producer’s choice between ARC and PLC for the ’19 crop year will carry over for the ’20 crop year. Producers will be able to change their program annually for ’21, ’22 and ’23.

UGA Extension Economist Adam Rabinowitz provided analysis of the programs, cautioning producers that making a blanket selection on program enrollment may not be the best choice.

“This is going to be very much a crop-by-crop decision and very much a farm-by-farm decision,” Rabinowitz said. He expects more Georgia farmers to enroll in PLC under the ’18 farm bill than they did under the ’14 farm bill.

Rabinowitz directed producers to the Texas A&M Agricultural & Food Policy Center Decision Tool (see box) to determine the program best for their farm. To use it, producers will need to establish a login. The tool requests the farm location (by county & state), crop, number of base acres, ’14 PLC payment yield, historical irrigated percentage and historical planted or prevented planting acres and yields from ’13-’17 for both irrigated and dry land.

Trade conflict help

Martin also reviewed trade assistance payments available under the ’19 Market Facilitation Program (MFP) announced in May to help farmers affected by trade conflicts, particularly with China.

Rabinowitz estimates Georgia’s share of the $14.5 billion MFP package would be about $341 million.

Moving forward, Rabinowitz notes that while China is beginning to buy more U.S. ag products, China has developed relationships with other trading partners, market dynamics have changed, and global competition is likely to increase after the U.S./China dispute is settled.

“As those shifts take place, it doesn’t mean that once we end the trade dispute and have an agreement that it all just goes back to the way it was before,” Rabinowitz said.

The first round of MFP payments started reaching farmers early this fall. On Nov. 7, the USDA indicated a second round of payments would be made available to farmers.
Visit www.gfb.ag/l9CAEDtradebrief or
www.gfb.ag/19trademitigation for more information.

Federal disaster assistance

The Wildfires and Hurricanes Indemnity Program-Plus (WHIP+) provides relief for farmers who lost crops to natural disasters in ’18 and ’19, chiefly Hurricane Michael and tornadoes. Martin said receiving WHIP+ payments requires at least 60% production crop insurance coverage for the next two available crop years.

Under WHIP-MIL, eligible dairies can receive payments for milk that was dumped due to Hurricane Michael and the tornadoes, provided producers were not compensated for the dumped milk. Producers compensated for portions of dumped milk may apply for payments on portions for which they were not compensated, Martin said.

The On-Farm Storage Loss Program provides help to producers who lost harvested commodities stored on their farm, like hay or grain.

DISASTER BLOCK GRANTS

On Nov. 8, the USDA announced $800 million in state block grants for ag losses in Georgia, Alabama and Florida from hurricanes Michael and Florence in ’18. At press time the USDA had not formally announced specific amounts per state.

The block grants were authorized under the $3 billion Disaster Relief Act (DRA) of 2019 signed into law in June to help producers nationwide recover from ’18 and ‘19 disasters. DRA includes the Wildfire and Hurricane Indemnity Program-Plus (WHIP+) as well as programs for loss of milk and stored commodities.

The grants will cover qualifying losses not covered by other USDA disaster programs for timber, cattle, poultry, along with necessary expenses related to horticulture crop losses and present value losses associated with pecan production.

“This is certainly welcome news for our farmers in Southwest Georgia,” said Georgia Farm Bureau President Gerald Long. “We’ve really struggled to overcome this disaster. While the block grants won’t make any affected farmers whole, hopefully they will make a huge difference.”

The USDA and the Georgia Department of Agriculture are working out final details for the grants. Once the recovery funds are released to the states, the GDA will still need time to implement the signup plan for farmers.

The GDA plans to publicize the signup period two to three weeks before it begins taking applications. The enrollment period is expected to last 21 calendar days.

For more information

ARC/PLC

FSA fact sheet

www.gfb.ag/19ARCPLCfacts

Texas A&M decision tool

www.afpc.tamu.edu/tools/farm/farmbill/2018

MARKET FACILITATION PROGRAM

FSA fact sheet

www.gfb.ag/19MFPfactsheet

UGA trade briefs

www.gfb.ag/19CAEDtradebriefs

DISASTER ASSISTANCE