Could Bigger Crops Conjure a 'Political Policy Issue'?

September 23, 2016 02:48 PM

Could large crop yield increases stir up controversy for farmers? Possibly - it’s because these larger yields may add up to overcompensation by government price support programs that act as a safety net, according to a report co-authored by Carl Zulauf for the University of Illinois at Urbana-Champaign.

Payment to farmers were once triggered by low commodity prices to help stabilize farm income. But now, payment is triggered by both price and yield declines, according to the report.

However, becuase of large yield increases since 2012, these payments could become a political policy issue, Zulauf says.

In 2015 and expected in 2016, farm revenues are down and so are prices, while yieeds are posting double-digit gains during the same period.

“Increases in yield can moderate low prices, causing revenue/acre to decline less than price,” according to the report. “Hence, a policy that pays on low prices may overcompensate farmers for their economic stress."

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Spell Check

Clydeene Harper
Booker , TX
9/23/2016 08:12 PM

  there is no help from the Farm Program in the Texas Panhandle for our low yields and low prices... just going into debt more for the 3 years... wheat only brings in about half of what it should and Milo is only a little better, so just building debt at this farm.

Newburg, ND
9/23/2016 05:32 PM

  The program didn't help enough the last two years when crops weren't as good and prices were low. No need to worry about farmers being overcompensated.

Trying to start farming
Hometown, IA
9/23/2016 07:10 PM

  Well now the farmer may actually make a living supporting a young family we are being "overcompensated" we work hard to increase yields to make more money with low commodity prices and we get punished! I guess I should have been the CEO of G.M. Then I would have not had to work so hard to get a government bailout


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