Farming is a tough business, fraught with uncertainty. Thankfully, Congress used the 2018 Farm Bill to strengthen many of the programs farmers use to manage risk, including the Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) programs.
The sign-up deadline for these programs is approaching quickly on March 16, and it’s important that farm producers are aware of their full range of options as this will be the first time that farmers can change their ARC and PLC enrollment choice since the two programs were established in the 2014 Farm Bill.
With all of the information out there on ARC and PLC, we called up Dr. Joe Outlaw, a renowned agricultural economist at Texas A&M and Co-Director of Texas A&M’s Agricultural & Food Policy Center, for his take on all things farm policy. Listen to this month’s episode of Groundwork here.
With funding from the USDA, Texas A&M developed a Decision Aid Tool to assist producers with the important decisions they need to make in regards to farm programs. That should be any farm producers’ first stop to evaluate all available options for your operation.
“There’s a lot of preconceived notions that certain policies are the best for a certain crop,” Dr. Outlaw said.
Dr. Outlaw stressed that all producers should take advantage of the one-time yield update opportunity, even if they elect ARC coverage, as it’s just the third time producers have had the chance to update yields since 1985.
Dr. Outlaw challenged head-on the tired criticisms that some Washington elites have leveled at trade aid payments through the Market Facilitation Program (MFP). The MFP payments were met with sighs of relief from farmers and ranchers across rural America and helped the farm economy survive last year’s trade disruptions. Dr. Outlaw noted that MFP payments were a worthwhile investment.
“The fact of the matter is the amount of protection that $25 billion in trade aid has given the farm sector is tremendous. When you look at the gross value of production in this country… in the scheme of things, it is a pennies on the dollar in terms of what it is protecting,” Dr. Outlaw said.
He continued, “There are those that would say that we need to allow the market to work and that’s a really nice way for ‘let’s let people go out of business and potentially prices will rise.’”
Dr. Outlaw expressed cautious optimism regarding commodity prices as trade deals are implemented, saying that a rising tide lifts all ships, and encouraged producers to take advantage of all price increases when they can.
No matter what farm policies a producer chooses to employ, the federal safety net is critical to protecting our farmers and ranchers as well as our rural communities – even in years it is not deployed.
“We have a strong safety net between crop insurance and Title I programs… [producers should] remember that they’ve got to make those good decisions, so their farm is as protected as possible,” Dr. Outlaw concluded.
We are all hoping that brighter days lie ahead for America’s farmers and ranchers. But no matter good years or bad, the farm safety net is essential to a healthy rural economy and protecting our vibrant and dynamic food supply.
Listen to this month’s full episode of Groundwork here.