Farm Leadership
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Estimated Wheat ARC-CO for PNW Counties
I spoke at the Spokane Farm Forum yesterday on the choices between ARC-CO and PLC and thought I would update estimated net payments for wheat ARC-CO for some of the counties located in the Pacific Northwest. Based on actual state data, Washington, Oregon and Idaho are estimated to have the largest wheat ARC-CO payments for […]
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Farm Loan Growth is Driven by Leaner Profits
The Federal Reserve Bank of Kansas City just released their latest Agricultural Finance Databook and as expected lower farm profits are leading to increased demand for operating loans. However, some of this increase is also due to the rapid increase in livestock prices during 2014 which results in greater operating loans just to service the […]
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Updated Information on Crop Insurance Budget Proposals
Yesterday, we had posted on proposed reductions in the crop insurance premium subsidy that the farmer normally pays based upon our review of the actual budget released by the White House. Today, I received more information on the actual proposed changes. First, President Obama calls for reducing the premium subsidy by 10% for revenue coverage […]
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President Has Crop Insurance in His Crosshairs
The President’s Fiscal Year 2016 budget just came out and one of the areas that he has identified for savings is reduction in the subsidies for crop insurance. Quoting the budget directly: “Overly generous benefits have almost eliminated the risk in farming at a cost to taxpayers in the billions. The Budget includes reforms that […]
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How Will Crop Insurance Guarantees Look This Spring
Today begins the first official discovery day of the corn and soybean (and other crops) spring projected prices for 2015 crops. As I write this post, corn is enjoying a rally of about 7 cents and beans are up about the same. Not sure where they will close today, but I thought I would take […]
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$500,000 Permanent Section 179 Could be Coming Soon!
The House Ways and Means Committee is expected to vote on seven expired tax provisions on February 4, including making permanent Section 179 expensing at the $500,000 level. The current level for 2015 is $25,000 and for any farmer who spends more than $225,000 on equipment during the year, the amount allowed is zero. Another […]
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ARC for Low Yields – PLC for High Yields
Many farmers will not elect 100% ARC or PLC. Even if ARC-CO will make a large 2014-crop corn payments, most will try elect some PLC on acres just in case substantially lower prices might occur in 2015-2018. In those cases, the firm rule of thumb is to elect PLC on your highest yielding farms first, elect […]
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Additional CBO Analysis
Yesterday, we posted on the new baseline study just released by the Congressional Budget Office (CBO). Today, I will add some additional analysis gleaned from the report: The CBO is projecting that many growers will sign up for ARC-IC and payments will range from about $350 to 707 million during the five-year life of the […]
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How Accurate is CBO on PLC and ARC
The Congressional Budget Office just released their updated baseline report for all farm programs. This baseline is an update from last April’s baseline and although their estimate of farm PLC and ARC payments may be fairly accurate over the 10 years of their projections, I highly doubt the accuracy of their projections for the 2014 […]
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Possible Maximum ARC-CO and PLC 2014 Payments
The University of Illinois in their FarmDoc Daily report released estimated ARC and PLC payments by state last week. For corn, the payments ranged from a low of zero for ARC-CO in multiple states (those with higher than average yields in 2014). Some of the key corn-growing states with estimated ARC-CO payments of zero were Kansas and Missouri. Each […]