Campiche Addresses Farm Bill Program OptionsMon, 03 Nov 2014 19:35:02 CST
As farmers are in the middle of harvest, they are also learning about the new options through the 2014 Farm Bill. Oklahoma State University, the Risk Management Agency and Farm Service Agency are hosting farm bill informational meetings across the state as farmers have several decisions to make.
Speaking at the Oklahoma Ag Expo in Midwest City Monday, OSU Assistant Professor Dr. Jody Campiche said farmers first need to understand yield update and base reallocation options. With the yield update, farmers will need to compile crop insurance information or elevator receipts to show their crop yields and decide if they want to update their yields or not. Wheat farmers will not be able to update their yields for their 2015 crop, but it will be in place for 2016. Campiche said there will still be benefits in updating wheat yields next year.
"If we are able to drop some of those low yields out, it will raise the overall coverage and APH for each farmer," Campiche said.
Earlier this summer FSA mailed out letters to farmers about base reallocation. The letter provided a landowner's planted acre history. Campiche said farmers will want to decide if there is a reason to reallocate acres to the crops that have been planted for the past four years.
Campiche talked with Farm Director Ron Hays at the Oklahoma Ag Expo. You can hear that conversation by clicking on the LISTEN BAR below
Next farmers will want to evaluate their different safety net options with the Ag Risk Coverage (ARC) or the Price Loss Coverage (PLC) programs. Campiche recommends farmers come to one of the OSU Farm Bill meetings to better understand their options to learn how one program might be valued over another and how both programs work with the new Supplemental Coverage Option (SCO) crop insurance program.
For 2015 spring planted crops, producers will need to think about their insurance levels for their spring crops. With lower commodity prices, premiums will be lower. Campiche said farmers will want to consider the cost of increasing crop insurance coverage, as farmers may be able to get more coverage for the same cost spent on the 2014 crops.
With the devastating drought this past year many Oklahoma counties will be receiving ARC payments. Campiche said there will a 2014 ARC payment on wheat as it was major disaster in a lot of areas of the state. She said these will not be large payments as these are shallow loss payments. She said farmers are going to have to compare ARC with PLC and SCO and decide which option could provide more coverage and a higher safety net over the life of the farm bill.
In making these decisions there are several different tools farmers can use. One tool was developed by OSU and the Kansas State University. Campiche said it is a excel based file that does not require an internet connection beyond downloading the initial file, which can downloaded at a OSU extension office. She said this tool is the easiest to use out of the group, where the farmer puts in the price and yield information into the spreadsheet.
Texas A&M University developed an Farm Program and Insurance Decision Aid. Campiche said its the most advanced of the three as it addresses crop insurance levels and the different program options. She said the program uses simulation, so as farmers input a price that number is adjusted by the mean of distribution.
The University of Illinois also launched a Farm Bill toolbox as a one-stop resource for farm program decisions, information and analysis. Campiche recommends farmers check out all three tool and select the one that makes the most sense.
Farmers have until March 31, 2015 to decide between ARC and PLC. By that time many Oklahoma wheat farmers will have pretty good handle on what the wheat crop will look like and that may help farmers decide between the programs. This is one time decision for the duration of the 2014 Farm Bill.
For the OSU Farm Bill webpage, click here.
The OSU-KSU Decision Aid Tool can be downloaded by clicking here.
For a full list of OSU Farm Bill meetings, click here.
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