AgDM newsletter article, May 2002
The 2002 Farm Security and Rural Investment Act (FSRIA) extends some of the payment provisions related to feed grain and oilseed production, and adds some new provisions. The bill provides for three different types of payments:
The crops that are covered by the bill include corn, soybeans, oats, wheat, grain sorghum, barley, and other small grains. Hay and forages are not covered.
There are three basic
decisions to make regarding the new commodity programs. These decisions are
made separately for each tract with a different Farm Service Agency identification.
1. You can keep your current program base acres, or update your base acres to reflect 1998-2001 cropping patterns.
2. If you do not update base acres, a soybean base will be created. You can then shift some base acres from other program crops into your soybean base.
3. If you do update base acres, you can keep your old program yields based on 1981-1985 levels, or you can update yields based on 1998-2001 levels.
The methods used to determine each type of payment are summarized in the table below. For more details on program acres, yields and payments refer to Decision File Commodity Programs for Crops.
Summary of Payment Acres and Yields
|Payment||Payment Rate per bu.||Payment Acres||Payment Yield|
|Loan deficiency||Co. loan rate – posted co. price||Actual harvested||Actual harvested|
|Direct||Fixed rate||85% of old or new base||Old program yield|
|Counter cyclical||Target price - higher of loan rate or market price - direct rate||85% of old or new base||Old or new program yield|
|Ag Decision Maker Home Page|