Conrad, Chambliss Target Price Amendment Details Start to Surface

June 14, 2012 06:53 AM

via a special arrangement with Informa Economics, Inc.

Draft of possible compromise includes higher target prices for key crops

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

Draft language for an amendment (2425) pushed by Sens. Kent Conrad (D-N.D.) and Saxby Chambliss (R-Ga.) among others would include the following target prices (link to draft of amendment):

Note: Sources say these target prices would be in addition to the Ag Risk Coverage (ARC) program, and not a farmer choice as is expected in the coming House bill and last fall's failed Super Committee-linked languge that gave a choice to farmers.

Wheat: $4.46 per bu.

Corn: $2.81 per bu.

Grain sorghum: $2.81 per bu.

Feed barley: $2.81 per bu.

Malt-type barley: $3.57 per bu.

Oats: $1.92 per bu.

Long grain rice: $11.00 per cwt

Medium grain rice: $11.00 per cwt

Soybeans: $6.30 per bu.

Other oilseeds: $13.18 per cwt

Dry peas: $8.82 per cwt

Lentils: $13.31 per cwt

Small chickpeas: $10.86 per cwt

Large chickpeas: $13.31 per cwt.

Peanuts: $25.25 per cwt.

The counter-cyclical payments would be made on 75 percent of the acres planted or prevented from being platned to a covered commodity on a farm, but not to exceed 75 percent of the total base acres for the covered commodity established for the 2012 crop year.

Payment yield is the yield established for counter-cyclical payments for the 2012 crop  year for a farm for a covered commodity.

Payment limit:

$65,000  except for peanuts | Separate pay cap of $65,000

Here's a look at where target prices would have been under the Super Committee-linked effort of last fall compared to current target prices:

06 14 12 TargetPrices

Perspective: You can clearly see the roles of Sens. Conrad (target prices for wheat, malting barley and peas and lentils, and prevented planted acres) and Chambliss (target prices for rice and peanuts and separate pay cap for peanuts). The soybean target price is much lower than the $8.31 level that was in the draft farm bill last fall.

Budget offsets, sources say, include taking away the yield plug changes on crop insurance and eliminating the peanut crop insurance provision from the Senate draft -- this could change. If those are the areas for savings to pay for the above proposal, then the cost for the effort is over $1 billion as the yield plug for crop insurance was esimated to cost $855 million and the peanut crop insurance provision would have cost $239 million for a total of $1.094 billion over 10 years.


NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.






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