This year producers have the option to opt out of the Average Crop Revenue Election (ACRE) program as part of the extension of the 2008 Farm Bill. The University of Illinois offers a number of FAST Tools including a handy ACRE Comparison Program that enables them to compare payments under ACRE and traditional commodity program options available in the 2008 farm bill. This makes it easy for you to "pencil out" what the best risk management tool is for your operation. Visit FarmDoc's website to download the ACRE Comparison Program spreadsheet.
Enrollment in the ACRE program requries a 20% reduction in the level of direct payments, and operators have until June 3, 2013 to decide if they want to opt in or out of the program for the 2013 crop year. ACRE payments for 2013 are based on the USDA average crop prices for corn and soybeans from Sept. 1, 2013 to Aug. 30, 2014 and not on current price levels.
But keep in mind, direct payments have been cut 8.5% as part of the sequester process. Pro Farmer is currently checking in on other potential cuts to ACRE due to the sequester. Stay tuned.