Iowa farms receive 'safety net' payments after corn, soybean prices drop
Programs protect against drops in crop prices
George C. Ford
Approximately 154,000 Iowa farms that enrolled in safety net programs created by the 2014 Farm Bill will receive checks for the 2015 crop year.
Agriculture Risk Coverage (ARC) and Price Loss Coverage are designed to protect against unexpected drops in crop prices or revenues due to market downturns.
Farmers in all of Iowa’s 99 counties experienced a 32 percent drop in price below the benchmark price established by the ARC program for corn and a 27 percent drop in price for soybeans.
In a news release, John Whitaker, executive director of the U.S. Department of Agriculture Iowa Farm Service Agency, said the payments will help provide reassurance to Iowa farm families who are facing low commodity prices compounded by unfavorable growing conditions.
“These safety-net programs provide help when price and revenues fall below normal, unlike the previous direct payments program that provided funds even in good years,” Whitaker said. “Payments by county can vary because average county yields will differ.”
Statewide, 147,133 farms participated in the ARC program and 6,592 farms in the price loss coverage program.
The 2014 Farm Bill ushered in the most sweeping changes to U.S. farm policy in nearly two decades. Among the biggest changes for crop producers was the elimination of direct payments.
Farmers no longer receive fixed payments per acre, whether crop prices are high or low — or if they did not plant at all. They must sign up for either the ARC program or the coverage program.
The one-time decision is effective through 2018, when the current Farm Bill expires.
The programs cap how much money an individual farmer can receive — $125,000 for individuals and $250,000 for married couples.