Producers have decisions to make regarding program coverage.
As peanut harvest got underway, USDA unveiled some of the new programs available to producers through enactment of the 2014 Farm Bill. Those programs are said to help producers better manage risk and provide the safety net needed in the agriculture business. “Farming is one of the riskiest businesses in the world,” said Secretary of Ag Tom Vilsack. “These new programs help ensure that risk can be effectively managed so that families don’t lose farms that have been passed down through generations because of events beyond their control. Unlike the old direct payment program, which paid farmers in good years and bad, these new initiatives are based on market forces and include county – and individual – coverage options. These reforms provide a much more rational approach to helping farmers manage risk.”
The new programs, Agricultural Risk Coverage (ARC) and Price Loss Coverage (PLC), are cornerstones of the commodity farm safety net programs in the 2014 Farm Bill. Both programs offer farmers protection when market forces cause substantial drops in crop prices and/or revenues. Producers will have through early spring of 2015 to select which program works best for their businesses. “We’re committed to giving farmers as much information as we can so they can make an informed decision between these programs,” said Vilsack. “These resources will help farm owners and producers boil the information down, understand what their options are, and ultimately make the best decision on which choice is right for them.”
These new programs help ensure that risk can be effectively managed so that families don’t lose farms that have been passed down through generations because of events beyond their control.
New Crop Insurance Option
Besides new program options, peanut producers will also have the opportunity to participate in a new crop insurance option, the peanut revenue policy, that will be available for eligible peanut producers. The policy, approved by the Federal Crop Insurance Corporation (FCIC) Board of Directors, paves the way for USDA’s Risk Management Agency to make it broadly available to producers for the 2015 crop year in all counties where yield-based insurance coverage is currently offered. The peanut revenue policy is one of several new risk management options authorized by the 2014 Farm Bill. The Georgia Peanut Commission and the Western Peanut Growers developed the policy under section 508(h) of the Federal Crop Insurance Act, which allows private entities to design and submit crop insurance products to the FCIC Board.
“This policy will help extend revenue insurance coverage to peanut producers to help them manage risks,” said Deputy Secretary Krysta Harden. “My parents are hardworking peanut producers in a small town in southwest Georgia, so I know first-hand how important this new policy will be to provide a lifeline to farmers affected by events beyond their control.” Georgia Peanut Commission advisory board member and producer Andy Bell, says, “I have represented the Georgia Peanut Commission on the crop insurance working group for a number of years, and I’m pleased to see final approval of revenue insurance options for growers. The revenue-based insurance provides growers with another tool to aid in the production risk of growing peanuts.”
“Also included is an increase in the replant provision and improved quality adjustment provisions that will allow growers the ability to complete a claim at harvest,” Bell says. The new insurance policy, which will be offered through the federal crop insurance program, replaces current peanut crop provisions. The policy will be based on the Common Crop Insurance Policy currently available for other major commodities and provide growers with a choice of Yield Protection, Revenue Protection, and Revenue Protection with the Harvest Price Exclusion. Available coverage levels will range from 50 percent to 85 percent. Information on the new peanut revenue policy for 2015 will be available on USDA’s Risk Management Agency’s website later this year.
Important Program Deadlines:
The U.S. Department of Agriculture announced the following as key dates for farm owners and producers regarding new 2014 Farm Bill established programs, Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC). According to USDA, the new programs, designed to help producers better manage risk, usher in one of the most significant reforms to U.S. farm programs in decades. Dates producers need to know are as follows: Sept. 29, 2014 – Feb. 27, 2015: Land owners may visit their local Farm Service Agency office to update yield history and/or reallocate base acres. Nov. 17, 2014 – March 31, 2015: Producers make a one-time election of either ARC or PLC for the 2014 through 2018 crop years. Mid-April 2015 – Summer 2015: Producers sign contracts for 2014 and 2015 crop years. October 2015: Payments for 2014 crop year, if needed.
Program Option Tool
Agricultural Risk Coverage (ARC) and Price Loss Coverage (PLC) are two options commodity producers have as a farm safety net from the 2014 Farm Bill, which ended direct payments. Producers will have until the end of March to select which program works best for their businesses. Covered commodities include barley, canola, large and small chickpeas, corn, crambe, flaxseed, grain sorghum, lentils, mustard seed, oats, peanuts, dry peas, rapeseed, long grain rice, medium grain rice (which includes short grain rice), safflower seed, sesame, soybeans, sunflower seed and wheat. Upland cotton is no longer a covered commodity. To help farmers choose between the ARC and PLC programs, USDA helped create online tools that allow farmers to enter information about their operation and see projections about what each program will mean for them under possible future scenarios. The new tools are now available at www.fsa.usda.gov/arc-plc. Answers to frequently asked questions can be found at http://askfsa.custhelp.com.