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W Texas | Ok, as I understand it, the new farm bill changes our insurance for crops. If you elect to go with county yield averages, you get paid at a .85 X county yield average. If you elect to use your own farm yield averages, you get paid at a .65 X farm yield average.
I think this is basically an attempt to save the local offices work in keeping up with farm yield averages? Not sure what other benefit there might be?
It seems to me the high end producers and/or folks with better soils are going to be penalized; whereas, there will be an indirect subsidy to folks who don't follow fertility guidelines, own poor farms, etc. Take a quarter section of poor soil in a county with mostly good soils as an example: that farm is going to get paid on a .85 rate for the county yield average, which is based on the better farms, for the most part. If this quarter section and the best quarter section in the county both are covered under the county yield scores, this quarter section is much more likely to collect a check, and is getting paid at the same rate!!!
This is going to eliminate any trepidation about putting CRP ground back into production, IMO. So this could result in more acres in general. However, it is going to provide less incentive for top end producers to pay attention to every detail, as it may be easier/more profitable to just go with county yield averages. Therefore, I could see county yield averages dropping slightly over the next few years.
A few questions for those in "the know":
1) Why the rule change? (I know that it is often erroneous to think that a rule change by the Feds has to be rational.)
2) How are the county yield averages going to be calculated? Surely they are not going to use the old "T yields"?? Those were much too low.
3) What are you all going to elect to cover with: the farm yield, or the county yield? My guess is that a lot of guys are going to use a combination of both, using the county yield for their poor farms, and the farm specific yield for their best farms. | |
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New Farm Bill Insurance .65 vs. .85 payment rate
