Prices are just too good for payments


WASHINGTON — According to the U.S. Department of Agriculture, because market prices are high, producers with corn, grain sorghum, soybeans and/or other oilseed base acres enrolled in USDA’s Direct and Counter-Cyclical Program will not receive partial 2007-crop-year counter-cyclical payments.


Average market price projections are above levels that would trigger these payments.

The 2002 farm bill requires that, if triggered, these payments be made for the 2007 crop after the first six months of the marketing year, which began Sept. 1 for these commodities.

Producers enrolled in the Direct and Counter-Cyclical Program may receive counter-cyclical payments when “effective” prices for eligible commodities are less than their respective “target” prices specified in the 2002 farm bill.

USDA calculates counter-cyclical payments based on historical base acreage and payment yields, not current production.

Final calculations

For the 2007 crop, USDA is to make the final calculation after the end of the marketing year. The average price for the marketing year will be available Sept. 29.

Current market price projections for the 2007 crop are above the price levels that trigger these payments by 70 percent for corn, 76 percent for grain sorghum and 94 percent for soybeans.

USDA calculated counter-cyclical payment rates for these commodities using the February World Agricultural Supply and Demand Estimates, which was released Feb. 8.

USDA’s World Agricultural Outlook Board issues the estimate reports, which provide the most current supply-and-demand forecasts available.

USDA said Dec. 3, 2007, that producers who are enrolled in the direct and counter-cyclical program and have wheat, barley and/or oats base acres would not receive partial counter-cyclical payments because average market price projections for those commodities exceeded levels that trigger these payments.


The 2002 farm bill requires that any overpayments to producers must be repaid.

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