FAQ: Farmers need to make decisions soon about the new USDA farm program for participating in either ARC or PLC. Deadlines are approaching. Will there be long lines at county FSA offices as we get closet to the February 27 and March 31 deadlines? Does FSA have enough staff to handle this if farmers wait until the last minute to decide?
Answer: The Wallaces Farmer editor attended a farmer meeting January 22 put on by ISU Extension in central Iowa. ISU farm management specialist Steve Johnson explained the new USDA farm program options and provided information about decisions farmers have to make regarding signing up for either ARC or PLC. At the start of the meeting Johnson asked for a show of hands as to how many farmers had already visited their FSA office to reallocate base acres and update yields; the first step in the process. Out of 125 farmers in the audience only 20 put up their hand. Johnson then asked, "What are you waiting for?" He advised everyone to go to the FSA office as soon as possible and get this done.
John Whitaker, state executive director for USDA's Farm Service Agency in Iowa, is concerned. He's encouraging producers to schedule a visit to their local FSA office as soon as possible. "Do it now," he advises. "Don't wait until the February 27 deadline for making your base acre and yield update decision. Also, when you visit with our FSA county staff about base acres and yields, try to make your ARC vs. PLC decision on that same visit. March 31 is the deadline for electing to enroll in either the Agriculture Risk Coverage or the Price Loss Coverage program. But don't wait until then to make your election decision."
Following are other current questions Whitaker answered in this Farm Program FAQ column for Wallaces Farmer. These questions are being asked by farmers contacting the county FSA office staff.
Question: Why can't I increase my farm's base acres?
Answer: The 2014 Farm Bill limits the total base acreage on a farm to the total of base acres that were on the farm as of Sept. 30, 2013.
Question: Can I allocate all my base acres from a farm from one or more covered commodities to the covered commodity of my choosing (e.g. move all base acres to corn or soybeans)?
Answer: The farm bill only allows a reallocation of base acres to covered commodities on a farm, based on the four-year average planted and considered planted (P&CP) acres in the 2009 through 2012 crop years. Owners have two choices: retain the base acres as of Sept. 30, 2013 or reallocate bases using the planting history of covered commodities, 2009 through 2012.
Question: As with Risk Management Agency, or RMA, programs, why can't I make an annual program change in FSA programs (PLC, ARC-CO or ARC-IC)?
Answer: The cost of the farm bill would have increased more than what was budgeted. Not to mention the economic impact it would have if producers could change their program elections on an annual basis simply because one program proved financially lucrative one year and the other program might work in their favor the next year; that's not how decision-makers and stakeholders envisioned the farm bill.
Question: How do we calculate a yield for a covered commodity on a farm when production isn't available for all the acreage in a year that the covered commodity was planted as the farm has had an operator change?
Answer: Yields for covered commodities planted during the 2008- 2012 crop years are certified based on total production of the covered commodity divided by the total acres. If some of the acreage of the covered commodity was farmed by a person other than the 2014 producers, the substitute yield can be used for that acreage or for that year by the current producer. In this case the producer would "blend" the yield from the acreage farmed with the substitute yield from the acreage that the producer did not farm that year.
Another option would be for the 2014 producer to obtain the yield data from the former producer. FSA isn't allowed to release the former producers RMA yield records to the current producer, unless the former producer consents to the release.
Question: What are the deadlines?
Answer: February 27 for base and yield update; March 31 for election of programs. Date for enrollment into contract is "to be determined." Producers should not wait until the last minute on any of these important deadlines. If you haven't done so already, contact your local FSA office and make an appointment as soon as possible.
Remember, landowners must agree to all base and yield updates, and producers should make a program election. Producers who make no program election with FSA will automatically default to PLC starting in 2015, with no payments in 2014.
Question: Is there a resource available for reliable yield data producers can use to calculate how the new safety net programs can offer best protection against market swings?
Answer: Yes, FSA has worked with USDA's Risk Management Agency to make certified yield data available to producers. Producers should contact their local FSA office to see if the information is available to them. This certified yield data belongs to the producer and only the producer associated with the crop insurance records will be provided this service.
Not only are base and yield updates the first step in the ARC/PLC election process, this is the first time since 1986 that producers have had the chance to update yields; don't miss out on this opportunity.
Question: What happens if I can't get the landowner to sign FSA's CCC-858 form (base reallocation and yield update) by Feb. 27 deadline?
Answer: The farm automatically retains the base acres and countercyclical (CC) yields as of Sept. 30, 2013. On March 2, current producers on the farm will be able to make an ARC or PLC election. Only producers who have a share in the covered commodity need to agree on the election. If an owner doesn't have a share in the covered commodity then his/her signature on the election is not required.
Question: How are the marketing year average (MYA) prices derived for each covered commodity?
Answer: USDA's National Ag Statistics Service surveys over 2,000 buyers of covered commodities during each of the months of the 12-month marketing year and obtains the total dollars paid by the buyer to the sellers of the covered commodity and the total bushels purchased to obtain a monthly price. These values are tallied from the 2,000 buyers each month and weighed across the 12-month marketing period to determine a final marketing year average price for each covered commodity.
Question: Are there resources available to producers to assist in making these important and complex decisions?
Answer: Yes, several online decision-making tools are available on the FSA website. Likewise, producers are strongly encouraged to attend any FSA and/or Extension Service educational meeting regarding the 2014 Farm Bill and ARC/PLC specifically. When it comes to these important business decisions, there is no such thing as too much information. Producers should contact their local FSA office or Extension agent to find out where meetings are being held in their respective locations.
Reminder: FSA recommends producers subscribe to GovDelivery, FSA's online news source. Producers can self-subscribe at www.fsa.usda.gov/subscribe or county staff will assist you in subscribing when you visit your local FSA office. Monthly updates and related announcements will be electronically delivered to you via email for 24/7 access to the latest farm bill information.