The new subsidy STAX will be available to upland cotton growers beginning with the 2015 crop, said USDA’s Risk Management Agency in a bulletin to insurers and its field offices. Formally named the Stacked Income Protection Plan of Insurance, STAX will replace current farm subsidies. Lawmakers say STAX should resolve a WTO decision against U.S. subsidies but Brazil has been skeptical. STAX combines a floor price for cotton with revenue insurance. “STAX may be purchased as a standalone policy, or may be purchased in conjunction with another crop insurance policy for upland cotton,” said the bulletin. It will be available in counties where federally subsidized crop insurance is available for upland cotton.
DTN provides additional detail: “STAX is a countywide revenue policy kicks in when revenue drops below 90% of expected revenue for the county. It will effectively cover losses ranging from 10% to 30% for countywide revenue average. As the name sounds, STAX is meant to be stacked on top of individual insurance policies”.