Due to the extension of the 2018 Farm Bill, farmers will have the same commodity title choices this year and have until the March 15 deadline to decide. The Biden Administration’s extension, signed on Nov. 16, authorized the U.S. Dept. of Agriculture’s (USDA) ARC/PLC Program to continue through Sept. 30, 2024.
The decisions include the Price Loss Coverage (PLC), which is a crop-specific, fixed-price support program that triggers payments if the marketing year average falls below the effective reference price. On the other hand, Agricultural Risk Coverage (ARC) at the county level is also crop-specific but varies by county. Payments occur if actual revenue falls below 86 percent of the benchmark revenue.
ARC at the individual level is a farm-level revenue support program. Like ARC at the county level, payments are triggered if actual revenue falls below the benchmark, but this combines all commodities planted in the year.
This year’s effective reference price for corn is $4.01, and $9.26 for soybeans. Both are above statutory reference prices. ARC for the county level will come into play with lower yields, while PLC payments will be larger with lower prices and higher yields.
While soybeans are currently coming out stronger than corn in terms of price ratios, USDA Chief Economist Seth Meyer recognizes a lot of factors could change farmer’s planting decisions between winter and spring.
This year is likely to see more competition between the ethanol industry and electric vehicles makers as sustainable energy becomes more accessible and the Biden Administrations pushes stringent regulations on vehicle emissions.
Lawmakers will have a tight turnaround for much of the same legislation when they return from their holiday break next week as when they recessed in 2023. Here’s a list of their top priorities.
