Posted 2/8/2019 20:51 (#7307608 - in reply to #7307515) Subject: RE: ARC/PLC - all about knowing your place....
I still have my file of scenarios and my "thoughts" regarding the ARC/ PLC initial pick program.
ARC to me was the equivalent of GRIP on the old crop insurance side. You pick this IF your yields were BELOW county average because that what the yield trigger is. OR, you picked this if you liked gambling on the ultimate county average.
PLC - pick that when your proven yield averages were ABOVE county average. Your yield is the trigger but with your superior yields and in a down trending, low price environment - the price x Yield component would pay you later in the 4 - 5 years period than initially.
The biggest issue with ARC/PLC program as a whole dealt with each county "subjective" average yield.... As I understood it (possibly incorrect) but the FSA county exec team could "adjust" the NASS yield up or down affecting the amount of the payout per acre. If you take a look at the payouts of surrounding counties, there is a sizeable variation of ARC payments between counties that will astonish anyone. The sizeable disparity ultimately got bid into rents/fert/chem/seed/iron/etc. They numbed the correction that should have taken place.