Ag Panel Leaders Likely Will Announce Farm Bill Agreement Today

via a special arrangement with Informa Economics, Inc.

To deal with budget issue, revenue protection payment calculation goes from 85% to 60% of planted acres

House and Senate Ag Committee leaders hope to issue an announcement today that an agreement has been reached relative to some details of a new farm bill. It is unclear whether the leaders will unveil actual language. The leaders will also reportedly say they have received positive feedback from some Super Committee members to include the agreement relative to any debt reduction package.

Significant changes have been made relative to previous farmer safety net proposals, sources advise, largely because Sens. Kent Conrad (D-N.D.) and Max Baucus (D-Mont.) insisted on going from a county to the farm level in determining revenue protection (RP) payments. The change: RP payments would be based on 60 percent of planted acres (base acres no longer used) as opposed to the prior 85 percent. The changes make the RP option less attractive for some producers, especially rice, contacts advise.

Program crop producers other than cotton (who will be limit to their Stacked Income Protection plan (STAX) will likely be provided a one-time option of going with the traditional target price program, albeit at higher levels, or a revenue protection option. Subject to change, sources say the following would be the new target prices:

Wheat $5.50 (current is $4.17)

Corn: $3.64 (current is $2.63)

Soybeans: $8.31 (current is $6.00)

Rice: $13.98 per cwt (current is $10.50)

Cotton would no longer have a target price.

The Congressional Budget Office, sources say, altered their prior projections regarding how many producers would take the revenue protection or the target price option. No official CBO estimates are available at this time.

The move to using planted versus base acres, sources signal, will likely aid soybean producers the most when determining future subsidies per acre by commodity.

The maximum acres allowed in the Conservation Reserve Program (CRP) will reportedly be phased down to 25 million acres from the current 32 million acre maximum level.

Also, Senate Ag Chairwoman Debbie Stabenow (D-Mich.) reportedly nixed an effort to include permanent language relative to the GIPSA rule language included in the recently passed FY 2012 minibus spending measure.