Economist Carl Zulauf of Ohio State University says crop subsidies of $30-$90 an acre are possible with record crops and farm-gate prices that average $3.60 a bushel, reports DTN. If prices run close to Zulauf’s estimate of $3.60, “it could spawn the largest commodity payments since at least 2004 and the prospect of some growers quickly hitting the new law’s $125,000 limit for the Agriculture Risk Coverage program, which functions like revenue insurance.
“Farmers are going to re-discover the value of commodity programs when they go through their new farm bill decision process,” Zulauf said to DTN. He says prospective soybean prices are close to levels that would trigger ARC payments.
Kansas State University economist Art Barnaby says counties with average corn yields could trigger ARC payments if season-average prices are $4.55 a bushel or lower and average farm-gate prices for soybeans are $10.56 or lower, said DTN. Payments to wheat growers could begin when prices average $5.68 or less, he says. Under ARC, payments begin when revenue, calculated on nationwide prices and yields in a farmer’s home county, are below the trigger set by law.