FSA Andy for July 2, 2009

Hello Again!

Here I sit, it’s Friday afternoon and I’m trying to figure out what to write for this article. FSA stuff can be a little boring and, of course, we are never allowed to provide an opinion because the agency is concerned that someone would come back and sue them for following some opinions.

I don’t always strictly adhere to that line of thinking, but it never ceases to amaze me what people will do. Here’s an example. Recently, some young but seriously misguided youths decided it would be fun to swipe a farmer’s newer Case/IH Magnum and proceeded to disk up a sizable number of acres of beans. They then proceeded to “Bigfoot,” a camper on the property, and to finish off matters they decided to see what would happen when they launched the tractor off the bank of the Tuscarawas River.

It made it across the river on its own, only to get stuck on the opposite side waiting to be found by its owner. Here’s an opinion for the judge. Blame no one but the culprits and require full restitution and six months minimum for all involved. I feel better.

Now we can talk about ACRE, as it appears nobody has been. The ACRE program was designed to supplement the Direct and Countercyclical program in helping farmers manage risk/revenue protection on individual farms. It’s not designed to replace crop insurance.

The program requires producers to give up 20 percent of the Direct DCP payments per enrolled farm, all Countercyclical payments and a 30 percent reduction of loan rates. In exchange, producers are provided revenue protection, which is based on a calculated dollar per acre guarantee. If final crop yields and prices calculate out to less than the guarantee, producers will be paid the difference.

Now here are some facts.

1. The program appears more complex than it really is.

2. Producers need to visit their FSA office and have a worksheet run on one of their contract farms to really see how the program works.

3. FSA can tell you the dollar amount you will give up, but can’t guarantee what you will get since that is based on crops/yields and prices that haven’t been planted or sold yet.

4. Producers will probably have to take the county plug yields unless you have crop insurance or very good sales records.

5. Producers who can’t prove their yields and regularly have higher yields than the county plug yield won’t want to participate.

6. Producers who have the opposite situation are well on their way to qualifying.

Bottom line: Don’t get caught up in the mathematical calculations/percentages and don’t try to figure out why the program was designed the way it was. You owe it to yourself to check it out.

Stay tuned, as next week I’ll give you my opinion on groundhogs and some goofy laws.

That’s All For Now,

FSA Andy