Jonathan Coppess University of Illinois A Difficult Farm Bills Challenges What were the options for farmers How best to make a fiveyear choice filled with unknowns What did farmers decide and why ID: 756176
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Slide1
Analyzing the New Farm Safety Net
Jonathan
Coppess
University
of
IllinoisSlide2
A Difficult Farm Bill’s Challenges
What were the options for farmers?
How best to make a five-year choice filled with unknowns?
What did farmers decide and why?
What is the initial feedback on the decision and programs?Slide3
Farm Program DecisionSlide4
Sorting Out The Farm Program Decision
McLean Co., IL: ARC-CO vs. PLC (160 bu. yield)Slide5
Farm Program Decision
FarmdocDaily
, June 16, 2015Slide6
Farm Program Decision—Corn
FarmdocDaily
, August 14, 2015
ARC-CO: 91% of farms; 93% of baseSlide7
Farm Program Decision—Soybeans
FarmdocDaily
, August 14, 2015
ARC-CO: 96% of farms; 97% of baseSlide8
PLC’s Realities
Commodity
Reference Price
2014
MYA Price
Payment Rate
Corn
$3.70
$3.70
$0
Soybeans
$8.40
$10.10
$0
Wheat
$5.50
$5.99
$0
Peanuts
$535/ton
$440/ton
$95/ton
L.G. Rice
$14.00
$11.90/cwt
$2.10/cwt
M.G.
Rice
$14.00
$14.40/cwt
$0/cwt
T.J. Rice
$16.10
$21.40/cwt
$0/cwt
Grain Sorghum
$3.95
$4.03
$0Slide9
Feedback & Issues: Revenue’s Realities
County average yields are a factor in program, especially in high-yield years like 2014
Farmers had to consider this in the decision; difficult to make straight comparison with price-only PLCSlide10
Feedback & Issues: Revenue’s Realities
With FSA yields and $3.70 MYA price, estimated ARC-CO payments on corn
Yields had significant impact on payments for corn.Slide11
Feedback & Issues: A Tale of Two CountiesSlide12
Feedback & Issues: Revenue’s Realities
ARC-CO for soybean base with FSA yields and $10.10 MYA price
Yields were again the determining factor for payments given a $12.27 per bushel benchmark price for ARC-COSlide13
Feedback & Issues: Revenue’s Realities
ARC-CO on wheat with FSA yields and $5.99 MYA price
Reference price at $5.50 and benchmark price at $6.60; yields were again determining factor on paymentsSlide14
2014 ARC-CO and PLC PaymentsSlide15
ARC-CO vs. PLC in 2014
Commodity
PLC Payments
ARC-CO Payments
Base in Program
Per Base Acre
Peanuts
$283,878,099
2,013,443
$141
Long Grain Rice
$308,627,163
4,007,809
$77
Corn
$3,283,483,819
90,057,276
$36
Wheat
$307,140,098
35,394,613
$9
Soybeans
$282,478,906
52,635,553
$5Slide16
Feedback and Issues: Revenue vs. Price
Reference price compared to the five-year Olympic average price
.
Trade-offs between high yields and low(er
) prices.
The unknown future.
Commodity
Reference
Benchmark
Corn (bu.)
$3.70
$5.29
Soybeans (bu.)
$8.40
$12.27
Wheat (bu.)
$5.50
$6.60
Rice (cwt)
$14.00
$14.17
Peanuts (ton)
$535
$557.40Slide17
Farm Program Decision Conclusions
Adding risk and complexity to risk management.
Decisions still follow the (expected) payments.
Strong acceptance of revenue-based assistance
.Slide18
Web Tool Usage—Farm Bill Toolbox
Google Analytics
Total Hits (thru July):
1,917,149Slide19
Web Tool Usage: APAS
Google AnalyticsSlide20
Follow-Up on Program Decisions & Tools
Further Analysis of Web Tool Usage and FSA Election Data
Farmer/
Landower
Survey
Analysis
of Web Tool Usage, Election Data and Survey Responses Slide21
Questions?
Thank You!
jwcoppes@Illinois.edu