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Brown, Thune Secure Improvements to Ag Risk Coverage
USAgNet - 12/17/2018

U.S. Sens. Sherrod Brown (D-OH) and John Thune (R-SD), both members of the Senate Committee on Agriculture, Nutrition, and Forestry, announced that this past week they secured bipartisan improvements to the Agriculture Risk Coverage (ARC) Program in the 2018 Farm Bill.

"Ohio farmers need effective risk management tools -- particularly when facing several years of low commodity prices. These updates to the ARC program will better protect against both low prices or lower than expected yields," said Brown. "The improvements in this bill will better protect Ohio soybean and corn growers from risks outside their control. This bipartisan bill builds on the reforms of the 2014 Farm Bill and is good for farmers and good for taxpayers."

"I'm glad the House and Senate came together to put the agriculture community ahead of politics and act on this important legislation. This pro-agriculture farm bill, which includes key improvements to the ARC program, will help give South Dakota farmers and ranchers greater economic certainty and will allow them to focus on what's most important in their line of work: growing crops and raising livestock," said Thune.

The bill will improve the ARC Program by modifying the payment calculation and other parts of the program to improve its safety net potential. By providing more equitable support prices that are reflective of the actual market value for all crops and using a 10-year market price average as a cap on reference prices, the Brown-Thune provision would take an important step toward ensuring farm programs are more fiscally responsible for taxpayers. The bill would also ensure that payments are not being made for base acres on land that is no longer being planted with commodity crops. Beginning farmers would, for the first time since 2002, have a new opportunity, based on planting history, to become eligible for new or additional base acres on certain farms that were previously ineligible or only eligible for limited commodity program assistance.

Specifically, the Brown-Thune bill will improve commodity program for Midwestern crops by doing the following:

- Using a trend yield adjustment factor to account for the improvement in yields over time;

- Increasing the plug yield used for the guarantee to 80% from 70%;

- Requiring ARC payments to be calculated using the physical location of each farm, instead of a farm's administrative county;

- Allowing farmers currently enrolled in ARC or Price Loss Coverage (PLC) to change enrollment beginning in 2021; and

- Maintaining the ARC individual option.

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