Farm Bill Update
Bipartisan support for the 2018 farm bill resulted in final passage by wide margins in both the House and Senate. The bill was signed by the president on Dec. 20. Notably, there was a relatively short eight months between the introduction of the 2018 farm bill and its final passage. According to the Congressional Research Service, this was the first time in nearly 30 years, i.e., since the 1990 farm bill, that a farm bill was enacted within the year for which programs were authorized and prior to the new-crop planting season. The current farm bill goes through the 2023 crop year and will cover 2023/24 marketing year crops.
Generic Talking Points
Brings another five years of certainty to farm and ranch families;
Upholds fiscal responsibility by being budget neutral;
Improves risk management programs;
Protects crop insurance;
Funds much-needed trade development;
Invests in the future with funding for ag research and beginning farmer programs; and
Continues nutrition assistance (three-quarters of total farm bill funding) for lower-income Americans.
Now time to focus on effective and efficient implementation.
2018 Farm Bill Changes:
The cap on Conservation Reserve Program (CRP) acres was increased from 24 million acres to 27 million acres by 2023, while also addressing the issue of CRP competing with farmers for
productive land by reducing rental rates and incentive payments. General CRP enrollment will be capped at 85% and continuous CRP will be capped at 90% of average cash rental rates in the county for comparable soil types.
Marketing loan rates were increased for all crops other than upland cotton, peanuts and minor oilseeds. Corn saw loan rates increase from $1.95 per bushel to $2.20 per bushel. Soybean loan rates were increased $1.20 per bushel from $5 per bushel to $6.20 per bushel.
Under PLC, fixed reference prices are now allowed to “float” higher based on the Olympic moving average price and may increase to as much as 115 percent of the statutory reference price
The historical ARC plug yield was 70 percent of the county’s transitional yield. The farm bill changes the plug yield to be no lower than 80 percent of the county’s transitional yield.
Data from the RMA crop insurance program will be the primary source of yield data as opposed to USDA National Agricultural Statistics Service yield surveys.
ARC and PLC program payments will be eliminated for growers who have not planted a crop on their historical base acres over the last decade.
Farmers who experienced poor crop yields during 2008 to 2012, the period used to establish program yields under PLC in the 2014 farm bill. To address this yield shortfall, the 2018 farm bill will provide an opportunity to update PLC program yields based on crop yields from 2013 to 2017, with a floor equal to 75 percent of the county average crop yield. The yield update will be effective for the 2020 crop year.
The 2018 farm bill provides an opportunity for growers to first re-elect ARC or PLC coverage in 2019 on a commodity-by-commodity basis, effective for the 2019 and 2020 crop years. Then, beginning in 2021, growers will have an opportunity to make an annual re-election of ARC or PLC for the three remaining crop years.
Kevin Kuhle with Iowa Farm Bureau –
Iowa’s largest grassroots farm organization, working for the people, progress, and pride of Iowa.
David Whitaker | Iowa Land Guy