Vilsack Resists APH Update
Wed Aug 6, 2014 05:14 PM CDT
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Dale Artho, a farmer outside of Wildorado, Texas, has seen his dryland wheat yields devastated over the last couple of years. A provision in the farm bill would help with that, but Secretary of Agriculture Tom Vilsack said it would not go into effect until 2016. (DTN photo by Chris Clayton)

BARSTOW, Calif. (DTN) -- Dale Artho lost all of his dryland wheat crop this year outside of Wildorado, Texas, as drought continued to devastate winter wheat yields in Texas and Oklahoma.

"I've had two years in a row on dryland where I've had zeros," Artho said in an interview with DTN last week. "I've had two years of the last four where I had yields harvesting anything from seven to 12 bushels. Our yields are worse than they were during the Dust Bowl."

The drought appears to have loosened its grip in recent months for farmers on the Southern Plains, but this year still produced the most disappointing winter wheat crop in Oklahoma since 1957. Harvest was cut in half with yield declining statewide from 31 bushels an acre last year to 17 bpa this year. Production fell to 51 million bushels.

Such poor yields whittle down a farmer's Actual Production History for crop insurance and increase the financial risk for the operation.

A provision in the farm bill is supposed to allow a farmer to exclude a recorded or estimated yield for a crop year when the entire county is 50% below the 10-year average county yield. Effectively, that year can be voided from a producer's yield history. A primer by the crop insurance industry adds, "This also applies to contiguous counties and allows for the separation of irrigated and non-irrigated acres."

Agriculture Secretary Tom Vilsack told reporters on a conference call Tuesday that USDA would not be able to implement that provision this year. House Agriculture Committee Chairman Frank Lucas, R-Okla., has been calling on USDA to enact the provision. Lucas has suggested that USDA could at least allow farmers in some drought-plagued counties to update their histories.

But Vilsack said the work on the APH has to be done by the same USDA officials in the Farm Service Agency and the general counsel's office who are focused on broader farm bill implementation issues. Vilsack said it was more important to roll out the Stacked Income Protection Program (STAX) for cotton and the Supplemental Coverage Option (SCO) insurance programs, as well as the two new commodity programs -- Price Loss Coverage and Agricultural Risk Coverage.

"We had a choice to make in terms of allocating assets," he said. "We are trying to get work done that was mandated by Congress."

In addition, updating APH is "complex" because it involves computations for each farmer based on each commodity and county statistics, he said.

"It is very IT intense and labor and staff intense," Vilsack said.

The secretary said that he doesn't know how feasible it is for an individual crop or counties to be designated to update APH. "What if you have a multitude of producers in one county, only a few in another county?" Vilsack asked rhetorically. "Those are decisions that have to be made if you want to single out commodities.

"I appreciate the concern of the chairman. Obviously he is concerned about his producers," Vilsack said, but he added that if USDA focused on APH and did not get the work done on the programs, Lucas "would be equally concerned about all producers."

Artho noted his banker looks at his crop insurance when lending operating funds for the year. Insurance is a key component to his stability, and that centers on the production history used by insurers.

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