Through the 2018 Farm Bill, farmers have a choice of three commodity programs to help protect themselves against a bad year, either in the crops or the market, and the deadline to choose one is fast approaching.
The three programs farmers can select are the Agricultural Risk Coverage (ARC) County, ARC Individual (or ARC-IC) and Price Loss Coverage (PLC).
Stan Cook, a program technician with the Williams County Farm Service Agency, said at a special meeting concerning the programs that the deadline for deciding which program to be enrolled in for 2019 and 2020 is March 15.
“Do your best to get us an election as much before March 1 as you can,” he said. “Start thinking of the deadline as March 1 ... The reason we want to impress a March deadline is if you would lapse in making a decision for 2019, you’re going to lose out on all 2019 money.”
That means the first payment the producer would get would be for 2020, but it wouldn’t be paid until 2021.
Cook said farmers just need to call the FSA at 419-636-2057 to get the ball rolling on making an election and getting contracts signed and completed.
“Time is of the essence in Williams County; We don’t have a ton of help, but we’re doing the best we can,” he said. “So, just make sure you do not miss out on your 2019 benefits.”
While there are three options and making a choice could be confusing as it involves a lot of numbers and math, Cook said people shouldn’t worry too much about it.
In the end, he said “it’s just the Farm Bill decision.”
“I don’t know if I would spend 20 hours trying to figure out all these manual calculations,” Cook said. “Again, reach out if you feel you need to. We’ll do what we can to help you out.”
He also said a single slide in the OSU Extension’s presentation to local farmers on Friday was the most helpful.
The slide asked three questions and gave advice on how to proceed based on the answers:
• Do you have FSA farms that were 100 percent prevent plant in 2019? If yes, ARC-IC should be considered.
• Do you have FSA farms that you planted in part in 2019? If yes, ARC-IC can be considered.
• Do you have FSA farms where you planted everything in 2019? If yes, ARC-County or PLC depending on crop; with significant prevent planting acres, ARC-IC may work.
The first thing farmers should consider is updating their PLC Yield Update.
Stephanie Karhoff, agriculture and natural resources educator with the Williams County Ohio State University Extension office, said this needs to be done with each FSA farm and each crop.
Farmers will need to fill out a form (CCC-867) that includes averaging the yields for several years and multiplying it by yield factors that vary by crop, county and even the nation.
That calculation will result in the PLC yield. Karhoff said if the number is lower than what the farmer currently has as their PLC yield, then there is no benefit to updating the yield.
There are pros and cons to updating the figure.
“Your yields might be needed for ARC Individual, so you might as well get this organized,” she said. “You might get an increased PLC payment and you can use it in future Farm Bills.”
It’s also a simple process to update.
Barriers exist, such as the time it takes to calculate, the necessity of the landowner signature and the fact that maybe the farmers don’t have verifiable yields.
“Maybe you’re just exhausted with how much homework you have right now to get everything together,” Karhoff said.
At the same, it is something people should take advantage of, especially if they haven’t updated their yield for several years.
Karhoff said farmers might not get the chance to update the yield in the next Farm Bill and Cook said the next Farm Bill could have payments based entirely on PLC yield.
If the farmer is turning in a new form, it will need to be signed by the landowner.
Because the FSA is expecting to see many yield updates and a possible increase in the ARC-IC program, Cook anticipates an increase in spot checks. That means the farmer should keep their records handy in a folder.
“You can have that work done, just throw all the paperwork you used to write these numbers in a folder and then, if you need to submit that folder to county committee, you can do that,” he said.
This needs to be updated by Sept. 30, but Cook said it’s best to do it sooner rather than later.
Choosing Commodity Program
Two of the programs, ARC-County and PLC, pay on 85 percent of base acres while ARC-IC is only paid on 65 percent of base acres.
PLC is the only program that allows a farmer to have a supplemental coverage option.
In Williams County, 44 percent of its farming acres were prevented from being planted this year because of the excessive rain earlier in the season.
Karhoff said this means ARC-IC would be the best payment for many people in the county, especially for farmers with a high number of prevented planting acres.
“You get paid in this program if your current year’s revenue is lower than the five-year revenue guarantee,” she said. “If you have 100 percent prevent plant, this makes sense because you have $0 revenue for 2019. No matter what, you’re going to be lower than that benchmark.”
ARC-IC compares a farmer’s revenue (yields multiplied by market yield average prices) to the benchmark revenue.
Selecting this option will require farmers to fill out a CCC-863 form that looks at yields from each crop over several years and takes the Olympic average from them.
This form, and the calculations involved in it, can take some time and be a bit confusing — Karhoff said it took her several times looking through the information to understand it — but she and Cook offered their help for anyone looking into the program.
“Don’t forget to use us as a resource,” Karhoff said.
Cook said there are also tools available to help.
The ARC County program protects against low prices and low yields based in the county while the PLC program protects against low prices.
ARC-County will be triggered when the price and county yield is less than the benchmark. PLC will be triggered depending on the market yield average.
Karhoff noted PLC was not triggered during the previous Farm Bill.
Tools are available to help people make a decision. Those can be found at farmoffice.osu.edu by clicking on the “Farm Bill” tab in the gray bar at the top of the page.
Once the option is chosen, Cook said the farmer will need to come in and sign paperwork for the program.
Receipt of the payment will depend on which program the farmer uses, with ARC-County payment coming first and ARC-IC coming a few months later.
“While ARC-IC is definitively going to pay if you are 100 percent prevent plant, that money is going to come later,” Cook said.
With this Farm Bill, farmers need to make their decision for 2019 and 2020 by March, but they will be able to change their election yearly starting in 2021.