With the advent of much lower corn and soybean market prices during 2024, together with reduced corn and soybean yields in some areas, many farmers and ag lenders are now wondering what the impact might be on potential farm program payments for corn and soybeans for the 2024 crop year. These payments would not be made until after October 1, 2025; however, it may be beneficial for 2025 cash flow planning purposes to make estimates regarding the potential 2024 farm program payments. Many crop producers in the Midwest were enrolled in the Ag Risk Coverage (ARC-CO) farm program choice on their corn and soybean base acres for the 2024 crop year. There will likely be a wide variation in the potential for 2024 ARC-CO payments from county-to-county, depending on where final 2024 county average yields for corn and soybeans end up.
Producers have a farm program choice each year on all eligible crops between the Ag Risk Coverage (ARC) and Price Loss Coverage (PLC) farm program choices. Payments in the PLC program are “price-only” and are based on comparing the 12-month national market-year average (MYA) price for a given crop compared to the established reference price for that year. If the 12-month MYA price is lower than the reference price, the producer would earn a PLC payment for that crop for the year. Enrollment in the PLC program has been fairly low in recent years due to corn and soybean commodity prices that have been well above the established PLC reference prices. The PLC reference prices for corn and soybeans increased for 2024; however, market-year average (MYA) prices for corn, soybeans and wheat will need to decline from current projections in order to earn PLC payments for the 2024 crop year.
The ARC-CO farm program choice includes a formula that uses 5-year average county-based yield calculations and 5-year average MYA prices to establish a benchmark revenue for the farm. The final calculated revenue for the farm is the actual county yield for a given year times the final MYA price for the year. If the final calculated revenue is lower than 86 percent of the benchmark revenue for the year there would be an ARC-CO payment for that year. There is also an “ARC-IC” farm program choice, which is based on farm-level yields; however, in many instances the ARC-IC program has had less payment potential than the ARC-CO program.
Many times understanding the formula for the ARC-CO programs can be a bit confusing. Sometimes the formula can be easier to understand by reviewing the data and results for the ARC-CO program from previous years. For information on 2023 ARC-CO payments, current and past benchmark yields, prices and revenues, historical ARC-CO payment levels, and other farm program information, producers should access the USDA ARC-PLC web site, which is at: www.fsa.usda.gov/arc-plc
The 2024 corn and soybean yields were above average in portions of the Midwest that avoided the extremely wet weather early in the growing season and were not impacted extensively by the very dry weather that existed late in the growing season. On the other hand, portions of southern Minnesota and adjoining areas on northwest Iowa had significantly reduced yields resulting from excess rainfall in May and June, together with very dry conditions in August and September.
In areas that have final 2024 county average yields that are above the established 2024 county benchmark yield for the county, there will likely be limited chances of receiving 2024 ARC-CO payment, unless MYA prices decline further from current levels. However, in portions of the region that have final county yields that are below county benchmark yields, there should be a possibility for some level of 2024 ARC-CO payments. The final 2024 county yield data for corn and soybeans in every State will not be available from the USDA National Agricultural Statistics Service (NASS) until late February, 2025.
The market year average (MYA) price for corn and soybeans is 12-month national average price in a given year from September 1st during the year of harvest until August 31st the following year, which is then finalized on
September 30th in the year following the production year for the crops. This is why any farm program payments that are earned for a given crop year are not paid by USDA until after October 1st in the following year. The marketing year to calculate MYA prices for wheat and other small grain crops is from June 1st in the year of harvest until May 31st the following year.
The 12-month national average MYA price for a given crop is based on the monthly average market price received by farm operators across the United States, which is then “weighted” at the end of the year, based on the volume of bushels sold in each month. The MYA price estimates can be tracked on a monthly basis in the monthly USDA World Agricultural Supply and Demand Estimates (WASDE) reports. The next WASDE report will be released on December 10, 2024.
Many crop producers in the Midwest are enrolled in the Ag Risk Coverage (ARC-CO) farm program choice on their crop base acres for the 2024 crop year. The 2024 benchmark prices for potential 2024 ARC-CO payments for corn, soybeans, and wheat were all increased from 2023 price levels. The reference prices for potential PLC payments were also increased for corn and soybeans for 2024, but stayed the same for wheat. The marketing year to determine the 2024 market year average (MYA) prices is from September 1, 2024 through August 31, 2025 for corn and soybeans, and June 1, 2024 through May 31, 2025 for wheat.
Summary of 2024 potential PLC and ARC-CO payments:
•Corn --- The 2024 PLC corn reference price is $4.01 per bushel and the 2024 corn benchmark price for ARC-CO payments is $4.85 per bushel. Based on the October USDA WASDE report, the current estimate for the 2024 MYA corn price is $4.10 per bushel. This is only $.09 per bushel above the threshold for 2024 corn PLC payments; however, it is $.75 below the 2024 corn benchmark price. At the current MYA 2024 corn price estimate, 2024 corn ARC-CO payments would initiated with a final 2024 county corn yield that is very near the 2024 county benchmark yield.
•Soybeans --- The 2024 PLC soybean reference price is $9.26 per bushel and the 2024 soybean benchmark price for ARC-CO payments is $11.12 per bushel. Based on the October WASDE report, the current estimate for the 2024 MYA soybean price is $10.80 per bushel. This is $1.54 per bushel above the threshold for 2024 PLC payments; however it is $.32 below the 2024 soybean benchmark price. At the current soybean MYA price estimate, ARC-CO payments would initiated with a 2024 county soybean yield reduction that is about 11-12 percent below the county benchmark yield.
•Wheat --- The 2024 PLC wheat reference price is $5.50 per bushel and the 2024 wheat benchmark price for ARC-CO payments is $6.21 per bushel. Based on the October WASDE report, the current estimate for the 2024 MYA wheat price is $5.70 per bushel. This is only $.20 per bushel above the threshold for 2024 wheat PLC payments and is $.51 below the 2024 wheat benchmark price. At the current wheat MYA price estimate, 2024 wheat ARC-CO payments would initiated with a final county wheat yield reduction of about 6 percent below the county benchmark yield.
There are many variables when it comes to estimating 2024 ARC-CO payments for corn and soybeans, since those payments are based both on final county average yields and final market year average (MYA) prices. We will have a much better handle on making sound ARC-CO payment estimates once we get the NASS yield data in February and get further into the 12-month market year. For information on current and past benchmark yields, prices and revenues, historical ARC-CO payment levels, and other farm program information, producers should access the USDA ARC-PLC web site, which is at: www.fsa.usda.gov/arc-plc
Note --- For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Phone --- (507) 381-7960; E-mail --- [email protected]

Commodity Credit Corporation (CCC) commodity loans on harvested corn, soybeans and wheat were regularly used by farm operators in the 1990’s and early 2000’s, as well as from 2015 to 2019, as a grain marketing tool. The use of CCC commodity loans dropped off considerably from 2008-2014 and again from 2020-2022, when grain prices reached their highest levels in many years. As farmers finish up the 2024 harvest season, the use of marketing assistance loans (MAL’s), which are the same as CCC commodity loans, has taken on more significance as an option in setting up post-harvest grain marketing plans for corn and soybeans.
The CCC commodity loans (MAL’s) are originated through county Farm Service Agency (FSA) offices after the grain has been harvested. The MAL’s are 9-month loans from the time the loan is established. A marketing assistance loan can be established both on farm stored grain and on grain in commercial storage with a warehouse receipt. Producers receive the value of the loan at the time the CCC loan is established. The loan can be repaid at any time during the 9-month loan period, by repaying the amount of the loan principal plus the accrued interest.
The 2018 Farm Bill established national loan rates for the various commodities that are eligible for the marketing assistance loans. Following are the 2024 national loan rates for common crops in the Upper Midwest:
· Corn --------- $2.20 per bushel
· Soybeans --- $6.20 per bushel
· Wheat ------- $3.38 per bushel
· Barley ------- $2.50 per bushel
· Oats --------- $2.00 per bushel
· Grain Sorghum --- $2.20 per bushel
The county loan rates are then adjusted higher or lower than national rates, based on local commodity price differentials compared to national price levels. Following is the range of county corn and soybean loan rates for MAL’s in the Upper Midwest States:
· Minnesota -------- Corn = $2.03 to $2.14/bu.; Soybeans = $5.85 to $6.18/bu.
· Iowa --------------- Corn = $2.08 to $2.30/bu.; Soybeans = $6.08 to $6.34/bu.
· Nebraska ---------- Corn = $2.05 to $2.28/bu.; Soybeans = $5.83 to $6.19/bu.
· South Dakota ----- Corn = $2.07 to $2.22/bu.; Soybeans = $5.70 to $6.13/bu.
· North Dakota ----- Corn = $2.00 to $2.22/bu.; Soybeans = $5.70 to $6.00/bu.
· Wisconsin --------- Corn = $2.04 to $2.17/bu.; Soybeans = $6.07 to $6.25/bu.
The MAL loan interest rate is adjusted monthly and is set up at one percent above the CCC borrowing rate from the U.S. Treasury. The interest rate on MAL loans is fixed for the entire term of the 9-month MAL, except for a potential CCC interest rate adjustment on January 1. The current interest rate on marketing assistance loans (as of 11-01-24) is 5.125 percent, which compares to an interest rate of 7.5 to 9 percent for short-term financing at many commercial ag lending institutions. Producers only pay interest for the time that the MAL is in place. Example --- $200,000 MAL corn loan at 5.125 percent interest for 180 days ($200,000 x .05125) / 365 x 180 = $5,055 interest payment for 6 months, which compares to $8,384 on a similar loan at 8.5 interest for 180 days).
Farm operators have the flexibility to place grain under a MAL at a local FSA office any time after the grain has been harvested, so they could take out the MAL in November or December, 2024, or wait until after January 1, 2025. Producers also have the flexibility to treat the commodity loan as either “income” or as a “loan” when the loan proceeds are received. Either of these decisions can have income tax implications, depending on how and when the loan proceeds are received. It is best to consult with a tax consultant before determining the timing and the preferred method of receiving the loan proceeds.
If commodity prices drop to levels that are lower than county loan rates, eligible producers would potentially be eligible to release the grain that is under a marketing assistance loan at a rate that is lower than the county loan rate. FSA issues a “posted county price” (PCP) for commodities that are eligible for MAL’s, which are updated and posted daily at local FSA offices, or available on county FSA websites. If the PCP is lower than the county loan rate, the producer could realize a “marketing loan gain” (MLG), if the grain is released at that lower PCP. (Example --- a producer places corn under a MAL at $2.10 per bushel, a few months later the PCP is $1.90 per bushel, resulting in the potential of a marketing loan gain of $.20 per bushel on the day the corn loan is released.)
If the PCP drops below the county MAL loan rate, producers also have the option to collect a loan deficiency payment (LDP) on a commodity, in lieu of putting the grain under a commodity loan. The LDP calculation is similar to the calculation for marketing loan gains. Grain that is already under a commodity loan is not eligible for a LDP, and a LDP can only be utilized once on the same bushels of grain. There has not been significant LDP eligibility for corn and soybeans since the early 2000’s and we do not anticipate any LDP opportunities for the 2024 corn and soybean crop that is being placed in storage.
Producers must be eligible for USDA farm program benefits and must have submitted an acreage report at the FSA office for 2024 to be eligible for marketing assistance loans on this year’s crop production. Producers must maintain “beneficial interest” in the grain while it is under a MAL. Beneficial interest means that the producer maintains control and title of the commodity while it is under a commodity loan. Farmers should contact their local FSA office to release any grain that is under a marketing assistance loan before it is delivered to market (“call before you haul”).
Following are some reasons that farm operators may want to consider utilizing marketing assistance loans (MAL’s) as part of their grain marketing strategies:
· Provides short-term credit at relatively low and stable interest rates.
· Loan funds can be used to pay post-harvest expenses and land rental payments for the current year or for prepaid crop inputs (seed, fertilizer, etc.) for the following crop year.
· Loan funds can also provide the necessary funds to make year-end or January principal and interest payments on term loans and real estate loans.
· Allows a producer to receive partial compensation for corn and soybeans during or following the Fall harvest season, when commodity prices are traditionally lower than average.
· Allows a producer the flexibility to market the grain in future months after the grain has been placed under a MAL, including forward pricing the grain for future delivery (remember that the commodity loan must be satisfied at the FSA office before the grain is delivered.)
· Commodity loans can also be used by livestock producers that plan to feed the corn or other grain, which is followed by just releasing the grain that is under loan as it is fed to livestock.
· If commodity prices decline below the county CCC loan rates, the grain that is under loan can be released at the lower price, or producers can collect a loan deficiency payment (LDP).
In Minnesota, FSA offices file a Central Notification System (CNS) form with the Minnesota Secretary of State Office on all grain used as security for a marketing assistance loan. These forms are similar to the CNS forms that are filed by ag lenders for farm operating loans to guarantee the transfer of funds when grain or livestock is sold to cover outstanding loan balances.
For further information on USDA marketing assistance loans (MAL’s) and county loan rates for various commodities, farm operators should contact their local FSA office, or go to the following website: https://www.fsa.usda.gov/programs-and-services/price-support/Index
Note --- For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Phone --- (507) 381-7960; E-mail --- [email protected]
​