January 15, 2015

An Update on the Farm Bill Toolbox and Farm Bill Decisions

Jonathan Coppess, Gary Schnitkey, Nick Paulson

Department of Agricultural and Consumer Economics
University of Illinois

Carl Zulauf

Department of Agricultural, Environmental and Development Economics
Ohio State University

farmdoc daily (5):8


Recommended citation format: Coppess, J., G. Schnitkey, N. Paulson, and C. Zulauf. "An Update on the Farm Bill Toolbox and Farm Bill Decisions." farmdoc daily (5):8, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, January 15, 2015.

Permalink http://farmdocdaily.illinois.edu/2015/01/update-on-farm-bill-toolbox-and-decisions.html


Now that the calendar has turned to 2015, the decisions of the 2014 Farm Bill loom large. The Farm Bill Toolbox, designed to be a one-stop resource for educational tools for all program decisions, has been updated and is being re-launched. Feedback from users has driven the upgrades and improvements to the web site. A reminder of the farm program decision deadlines and highlights of the Farm Bill Toolbox's contents are provided by this article to help landowners and farmers as they close in on the decisions for this farm bill.

Background

The farmdoc team at the University of Illinois is leading a national coalition of organizations under a cooperative agreement with USDA's Farm Service Agency to provide online educational resources for farmers and landowners to help them with the program decisions in the 2014 Farm Bill. Web-based payment calculators, articles, webinars, meetings and more have been developed for this effort and all can be found in the Farm Bill Toolbox. Based on feedback from users and through continuing efforts to provide analysis, information and resources, the Farm Bill Toolbox has been updated as discussed below.

Commodity Crop Decisions

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The 2014 Farm Bill provided landowners with a one-time opportunity to update the program or payment yields on their FSA farm, as well as a one-time opportunity to reallocate the base acres on the FSA farm. The 2014 Farm Bill also provides producers of covered commodities (or program crops) on the FSA farm a one-time decision to elect the farm program(s) for the FSA farm. The program election decision is among Agriculture Risk Coverage at the county level (ARC-CO), Price Loss Coverage (PLC) and Agriculture Risk Coverage at the individual farm level (ARC-IC). ARC-CO and PLC are crop-by-crop decisions whereas ARC-IC, if selected, is for all program crops on the FSA farm.

Resources for all of these 2014 Farm Bill decisions can be accessed from the Farm Bill Toolbox, which can be found by typing "Farm Bill Toolbox" into any search engine, or by entering this web address: http://farmbilltoolbox.farmdoc.illinois.edu/.

For producers of program crops and landowners with base acres, key educational resources for making decisions at the "Farm Bill Toolbox"

  • The ARC/PLC decision steps--seven steps to guide landowners and producers through the payment yield update, base acre reallocation and ARC/PLC election decisions. Each step includes overview information, summary details, detailed analytical articles originally posted on farmdoc daily, answers to Frequently Asked Questions (FAQ), webinars and videos, including instructional videos for using the online payment calculators.
  • Agricultural Policy Analysis System (APAS)--APAS is the web-based program payment calculator (located at http://fsa.usapas.com and on the Farm Bill Toolbox) that is interconnected with the seven decision steps so producers can learn about the decisions and get expected payment estimates.
  • Farm Analysis Solution Tools (FAST)--Microsoft Excel spreadsheet tools that can be downloaded and used to compare ARC-CO and PLC expected payments for specific price and yield scenarios entered by the producer. A second FAST tool uses program payment estimates to help with the yield and base acre decisions (more on these tools can be found here and here).
  • Seminars--a series of 14 regional seminars on the farm programs and decisions will be conducted around Illinois in conjunction with Illinois Farm Bureau, Corn Growers, Extension and FSA. Registration for these seminars is currently open and anyone interested in the farm bill decisions is welcome to attend; the meetings are provided at no cost but registration is requested.
  • Webinars--the Farm Bill toolbox includes archived webinars from the series conducted in the Fall of 2014 and, coming soon, a new series of webinars will be announced to cover each of the decisions and provided updated analysis on the programs and expected payments.

Non-insured Crop Disaster Assistance Program

For producers of non-program or specialty crops, the 2014 Farm Bill revised the non-insured crop disaster assistance program (NAP) to permit growers to purchase NAP coverage at levels covering up to 65 percent of the production loss, indemnified at 100 percent of the market price (known as 65/100 coverage). A web-based tool is now available on APAS under the "NAP Buy Up" button to evaluate these alternative It calculates expected costs to the producer for enrolling individual crops or multiple NAP crops at the different coverage levels, including the NAP fees. NAP indemnities are capped at $125,000, and therefore premium costs for covering crops will not exceed $6,562.50 per farm. APAS will help producers understand the potential value on their farm for enrolling eligible crops.

Dairy Margin Protection Program

The 2014 Farm Bill also provided dairy producers with a new margin-based support program called the Margin Protection Program (MPP). To make these decisions, a web-based Margin Protection Program calculator is available. This calculator helps producers make their participation decisions by estimating payments at the different margin levels provided for in the 2014 Farm Bill. The MPP tool also provides valuable information and analysis to help guide dairy farmers with this decision. While sign-up is currently closed for this year, it is an annual sign-up process and dairy producers can continue using the tool for future program decisions.

Conclusion

The deadline for landowners to make payment yield and base acre reallocation decisions is February 27, 2015, while deadline for the producer's program decision on ARC-CO, ARC-IC and PLC is March 31, 2015. As these deadlines approach, landowners and producers are reminded that the Farm Bill Toolbox has been created under a cooperative agreement with the Farm Service Agency as a one-stop online educational resource to help with the decisions. Included in this toolbox are decision steps, analysis and links to educational meetings, webinars and videos, as well as links to online payment calculators. The Toolbox and APAS also contain links to an online Margin Protection Program calculator and related resources, as well as the online NAP buy-up calculator. Farmers and landowners are encouraged to make use of these tools to aid in their decision-making.

References

Schnitkey, G. "Base Acre and Yield Updating Tool: A Release of Spreadsheet to Aid in Making Farm Bill Decisions." farmdoc daily (4):235, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, December 9, 2014.

Schnitkey, G., N. Paulson, J. Coppess, and C. Zulauf. "Comparing ARC-CO to PLC: APAS Sample Farms and the ARC-CO - PLC Comparison Tool." farmdoc daily (4):200, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, October 16, 2014.

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