Farmers now have more time to make the decision concerning their farm program choice between the existing DCP and the new ACRE election. The deadline has been extended to August 14, 2009. This extension will allow farmers the opportunity to learn more about the different options, as well as have a more accurate estimate of the state revenue guarantee for corn and beans. The state wheat revenue guarantee will be finalized by this date. Attached to this article is a factsheet created by FSA that provides additional information about the ACRE election.
Although the deadline for making the ACRE election has been extended, farmers should still be studying and thinking about the election implications now. For instance, the 20% reduction in direct payments averages $3.71 per acre here in Ohio, but FSA farms with high corn base acres will be higher while FSA farms with high soybean, oat or barley bases will be substantially lower. Also FSA farms that do not have 100% of the acres in base acres could potentially benefit since payments are based on planted acres not base acres.
Why is this important? Since the ACRE election is based on planted acres instead of base acres, farmers might want to plant the farms that they are considering on enrolling in ACRE to the crop that they believe has the highest probability of receiving an ACRE payment. For instance if corn prices remain strong (above $3.80 average US cash price for 2009 crop year) then an ACRE payment will probably not occur. If on the other hand soybean prices are weak (below $8.75 average US cash price for 2009 crop year) then and ACRE payment is probable. If this is the scenario that one expects then the farms that might be enrolled in ACRE should be planted to soybeans. These prices are for illustrative purposes only and should not be considered accurate. Every farmer should access the ACRE program software at http://www.farmdoc.uiuc.edu/ to determine the numbers for their farm using their own assumptions.
Also farmers need to be aware that to be eligible for SURE (and any potential payments) on the 2008 crops they will need to purchase CAT and NAP on all insurable crops by May 18, 2009. Paying such a buy-in fee does not provide the producer with crop insurance or NAP for the 2008 crop year; it merely permits the producer to become eligible for the 2008-crop disaster assistance programs. Farmers need to access the SURE calculator at http://www.fsa.usda.gov/Internet/FSA_File/sure_calculator.xls and enter their farms information to determine if “buying-in” makes sense for their farming operation. Below are a few factsheets that provide additional information about the programs.
ACRE Program Backgrounder
https://bpb-us-w2.wpmucdn.com/u.osu.edu/dist/9/29991/files/2010/08/acrebkgrd.pdf
ACRE Factsheet
https://bpb-us-w2.wpmucdn.com/u.osu.edu/dist/9/29991/files/2010/08/acre.pdf
SURE Factsheet
https://bpb-us-w2.wpmucdn.com/u.osu.edu/dist/9/29991/files/2010/08/Sure_Factsheet.pdf
DCP Program Factsheet
https://bpb-us-w2.wpmucdn.com/u.osu.edu/dist/9/29991/files/2010/08/dcp2008.pdf