Ag Policy Blog

We've had a couple of questions that make me go "Hmmm" over the last few days on farm bill programs.

CRP and Base Acres

What happens with land that comes out of the Conservation Reserve Program when you update base acres?

On Tuesday, as much as 1.81 million acres in Conservation Reserve Program could have expired from enrollment, though landowners did have the option to extend the contract for up to a year if they chose to do so.

There are roughly 9.2 million fewer acres in CRP since fiscal-year 2008, putting total acres in the program at just under 25.5 million at the end of August.

What happens with CRP acres when it comes to base reallocation? Since base acres are essentially the monetary trade of commodity programs, the 2014 farm bill doesn't allow farmers to increase their base acres from what they have now.

Talking with FSA staff, I learned that what happens with CRP depends on whether the acreage that was in CRP was originally part of a farm's base acreage. For base acres that were enrolled in CRP, that land gets base acres restored to the base from which it was removed when enrolled – corn, wheat, soybeans – whatever crop base was established prior to CRP participation.

Not all land enrolled in CRP in the ‘80s, ‘90s, and early 2000s was established on base acres, although CRP enrollment requires land to have been used for growing a crop. Farmers should review their letters to confirm their base-acre information, including whether their CRP land was part of their base.

When landowners received letters in late July about their base acres, that should have also included details about base acres that had been in CRP.

If base acres came out of CRP before Sept. 30, 2013, those base acres can be reallocated to different crops. CRP base acres coming out of CRP now would not be eligible for reallocation.

Landowners have until Feb. 27, 2015 to wrap up their decisions on reallocation of base acres and yield updates.

Yield Update

On another front, some producers have emailed about proof needed to update yields on base acres.

Farm Service Agency is largely allowing owners and operators to self-certify yields, but FSA could come back and ask landowners and farmers to prove the yield.

The yield update formula calculates yields for a covered commodity such as corn by taking 90% of the average yield for the 2008 through 2012 crop years. Years in which corn was not planted on that ground are not factored in.

A substitute yield of 75% of the county average can be used for any year in which a farm had a collapse in yield that falls below that average. However, the substitute yield cannot be used on that ground for years in which no covered commodity was planted.

In an example, let's say a farmer had the following corn yields and county yields for 2008-2012:

Year: Farmer County (75%)

2008 164bpa 118

2009 no plant 121

2010 153bpa 110

2011 no plant 116

2012 83bpa 101 Correction there: Earlier I had typed the incorrect year

2012 was the drought year. In that case, 75% of the county average was better than the farmer's individual production. So the math would be (164 + 153 + 101 = 139). The 139 would then by multiplied by .90 to get a 125 bpa for the Price Loss Coverage yield.

Owners certify the actual yield for each commodity planted on the farm from 2008 through 2012. The yield can be given to FSA by either the landowner or the farm operator, but the decision to update or keep the old base yield is solely the owner's decision. FSA will not require proof of yields at the time of sign up, but FSA could request supporting evidence. Yield data provided for crop insurance can be used as verification.

For more information, check out the Farm Service Agency notice on yield updates: http://www.fsa.usda.gov/…

Follow me on Twitter @ChrisClaytonDTN

© Copyright 2014 DTN/The Progressive Farmer. All rights reserved.