Farmers finalize farm program elections as March 31 deadline nears
Kevin Hurst is taking an old-school tactic to deciding which farm programs to choose—he’s flipping coins.
“It’s a hard decision to make, and you have to pick and choose for [Farm Service Agency] farms and crops,” says Hurst, who raises corn and soybeans in Tarkio, Mo.
As Hurst evaluates his options, he’s leaning toward the Price Loss Coverage (PLC) program rather than Agricultural Risk Coverage (ARC).
“When we started, I thought we’d go with ARC-County [ARC-CO], but we’ve not had any bad years,” he told Pam Fretwell on “Straight from the Heartland” online radio program.
“We’ve had good crops, so I’m trying to maximize that,” Hurst says, adding he expects prices will continue to sputter.
Richard Guse of Waseca, Minn., thinks he’ll elect ARC-CO for corn. “It’s depends on your outlook on where prices are headed between now and 2018,” he notes. “From my standpoint, ARC-CO pretty much guarantees a payment for 2014—a pretty good payment—and a little less for 2015.”
With corn prices hovering at $4, he thinks ARC-CO is a better bet financially. “People are wondering how they are going to cash flow the 2015 crop, so I think it’s important to take cash when it’s available,” Guse says.
When it comes to soybeans, Guse plans to stick with ARC-CO, unless prices take a serious turn for the worse before the March 31 election deadline.
“If I were going to do PLC at all, I would do it on soybeans,” Guse says. “However, I’m not bearish enough to do any PLC right now.”
To help you make a final decision, Paul Neiffer, Top Producer columnist and CPA for CliftonLarsonAllen, offers these three rules of thumb:
- Always elect PLC on the highest-yielding acres first.
- Always elect ARC-CO on the lowest-yielding acres first.
- You can mix PLC and ARC-CO. For example, if you are bumping up against payment limits, elect PLC after maximizing ARC-CO payments.
Remember, your elections and subsequent enrollment will remain in effect for your 2014 through 2018 crops.
For the latest farm bill news and resources to help you make the best decisions for your farms, visit www.AgWeb.com/farm-bill