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January 2025
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2025 Farm Program Deadline Is April 151/22/2025 Eligible farm operators have from January 21 until April 15 to enroll in the 2025 farm program, either online or at local USDA Farm Service Agency (FSA) offices. Late in 2024, the 2018 Farm Bill was extended for one year, extending the expiration of the current Farm Bill until September 30, 2025. This also meant that the provisions and parameters that existed for traditional farm programs will continue for the 2025 crop year for corn, soybeans, wheat, and other crops. The good news for farm operators is that the reference prices for corn, soybeans, and wheat will all increase for the 2025 crop year. The reference prices are used to calculate potential PLC payments for a given commodity. The benchmark prices that are used in determining potential “Ag Risk Coverage” (ARC) payments for corn, soybeans, and wheat are also increased for the 2025 farm program.
Eligible cops for farm program benefits include corn, soybeans, wheat, oats, barley, grain sorghum, long grain rice, medium/short grain rice, temperate japonica rice, seed cotton, dry peas, lentils, large and small chickpeas, peanuts, sunflower seed, canola, flaxseed, mustard seed, rapeseed, safflower, crambe, and sesame seed. Producers can choose between the price-only “Price Loss Coverage” (PLC) and revenue-based “Ag Risk Coverage” (ARC) program choices for the 2025 crop production year. The ARC program choice includes both the county-yield based “ARC-CO” program choice, which is the most popular, and the “ARC-IC” program, which is based on farm-level yields. If no choice is made, the 2024 farm program choice will remain in place for 2025; however, producers still need to enroll in the 2025 farm program in order to be eligible for farm program benefits. Crop base acres for 2025 will remain at the same levels as 2024 for all crops on most farms, unless there are adjustments in base acres for crop acres that were added via land purchases or rental agreements or acres that are no longer eligible for farm program payments. The farm program yields on individual farm units, which were last updated in 2020, will be continued to calculate potential PLC payments in 2025. The ARC-CO “benchmark yields” for 2025 are based on the “Olympic-average” Risk Management Agency (RMA) county average yields for the 2019 to 2023 crop years. The national “market year average” (MYA) price for each program crop for the years 2019-2023 was averaged to calculate the 2025 “benchmark price” for the ARC-CO and ARC-IC programs. The calculation formulas, etc. for the 2025 PLC, ARC-CO and ARC-IC programs will remain the same as in previous years. PLC payments for 2025 will be made if the final MYA price for 2025 falls below the reference price for a given crop. ARC-CO payments for 2025 will be made if the final county revenue for the year (county yield x final 2025 MYA price) falls below the 2025 benchmark revenue (county benchmark yield x benchmark price) for a given crop. The calculations for the ARC-IC program are the same as for the ARC-CO program, except ARC-IC uses farm-level yield data and considers all crops on a farm unit together for calculation of potential payments in a given year. PLC and ARC-CO payments will be paid on 85 percent of crop base acres, while ARC-IC payments are paid on only 65 percent of base acres. The 2015 Farm Bill established “statutory reference prices” for all crops that were used to calculate PLC payments. The 2018 Farm Bill set the fixed statutory prices as minimum reference prices and added the possibility for “effective reference prices”. This allows the reference price to increase by as much as 15 percent above the fixed reference price (fixed price x 115%). The final calculated reference price for a given year is the higher of the fixed statutory price or the 5-year “Olympic average” price for a commodity times 85 percent (.85). The “Olympic average” price is calculated by taking the market year average (MYA) price for the five previous years (not including the current marketing year), dropping the high and the low price, and then averaging the other prices for the other three years. For the 2025 crop year, the “Olympic average” price is based on the MYA prices for the years 2019 to 2023, which is then multiplied by 85% (.85) to determine the final reference price. The 2025 reference prices for both corn and soybeans will be at the maximum level (115% of the statutory price). The final effective reference prices (ERP) for the 2019 to 2023 crop years were at the minimum statutory levels of $3.70 per bushel for corn, $8.40 per bushel for soybeans, and $5.50 per bushel for wheat, meaning that calculation for higher reference prices was not triggered for any of those three crops. MYA prices have been high enough in recent years to result in higher PLC reference prices for corn and soybeans in both 2024 and 2025, as well as for wheat in 2025. The 2025 reference prices are $4.26 for corn, $9.66 for soybeans, and $5.56 for wheat. The higher reference prices potentially increases the likelihood of PLC payments for the 2025 crop year, especially for corn and wheat, if average market prices decline during the 2024-25 marketing year. PLC payments are not as likely for soybeans at current market price trends. The higher PLC reference price for corn will likely make 2025 farm program decisions for corn a bit more challenging than in recent years. Key points to remember about the 2025 Farm Program decision: • The 2025 reference prices for the PLC program are: Corn = $4.26 per bushel ($4.01/Bu. in 2024 & $3.70/Bu. in 2023) Soybeans = $9.66 per bushel ($9.26/Bu. in 2024 & $8.40/Bu.in 2023) Wheat = $5.56 per bushel ($5.50/Bu. in 2024 & 2023) • The ARC-CO and ARC-IC benchmark prices for 2025 are: Corn = $5.03 per bushel ($4.85/Bu. in 2024 & $3.98/Bu. in 2023) Soybeans = $12.17 per bushel ($11.12/Bu. in 2024 & $9.57/Bu. in 2023) Wheat = $6.72 per bushel ($6.21/Bu. in 2024 & $5.50/Bu. in 2023) • Final 2025 MYA prices for corn and soybeans will be calculated from 9-01-25 to 8-31-26. As a result, the current trends in crop prices may not necessarily impact final 2025 farm program payments. Final 2025 MYA prices for wheat and other small grains will be calculated from 6-01-25 to 5-31-26. • Calculation formulas for the PLC and ARC-CO programs are as follows: PLC payment per crop base acre = (2025 Ref. Price – 2025 MYA price) x program yield x .85 (If the final 2025 MYA price is higher than the reference price, there is no PLC payment.) ARC-CO Benchmark (BM) revenue guarantee per acre = County BM yield x BM price x .86 Final 2025 ARC-CO revenue per acre = Final 2025 County yield x Final 2025 MYA price ARC-CO payment per base acre = (BM Revenue Guarantee – 2025 Final Revenue) x .85 (If the final revenue is higher than the BM revenue, there is no 2025 ARC-CO payment.) • For official information on PLC and ARC-CO programs, and other farm program details, go to the FSA farm program website at: www.fsa.usda.gov/arc-plc For a listing of 2025 county benchmark yields and revenues for all crops, refer to: https://www.fsa.usda.gov/programs-and-services/arcplc_program/arcplc-program-data/index • Following are some good Farm Program web-based decision tools to assist producers: University of Illinois FarmDoc website --- https://farmdoc.illinois.edu/ North Dakota State University --- https://www.ag.ndsu.edu/farmmanagement/farm-bill Kansas State University --- http://www.agmanager.info/ag-policy/2018-farm-bill • Kent Thiesse, Farm Management Analyst with the Green Solutions Group, has prepared an information sheet listing key points regarding the 2025 farm decision for corn, soybeans and wheat for the 2025 crop year. To receive a copy of the “2025 Farm Program Decision “Cheat Sheet”, send an email to: [email protected] For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group Phone - (507) 381-7960; E-mail - [email protected]
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