ARC Payments

Corn, soybean and wheat farmers who have seen significant support from the agricultural risk coverage program the last few years could be in for a surprise this fall. The voluntary Agriculture Risk Coverage and Price Loss Coverage programs incorporated into the current farm bill provide participating farmers with protection against adverse changes in market conditions. ARC has either a county-based or individual-based option.

But as the formula for the ARC program payments evens out over multiple years, the payouts change, according to Jack Irvin, OFBF senior director of state and national policy and Barry Ward, Ohio State University Extension and leader, production business management, on a recent episode of Field Day with Jordan Hoewischer, a new Farm Bureau audio interview series.

“The ARC and PLC programs have been pretty significant here in Ohio,” Irvin said. “We don’t expect to see much, if any, payments coming out of those programs this October, particularly in corn and soy. There may be a little bit on the wheat side of things, but keep that in mind for planning purposes.”

Ward noted that the ARC county payment is based on benchmark numbers — a series of prices and yields. Those revenues are based off of a rolling average, Irvin added, so those higher levels of support seen for the last few years “have cycled out as we’ve moved into this era of mid-$3 corn.”

“Part of the reason farmers saw significant payments in the falls of 2017, 2016, 2015 was because we had a fairly high benchmark price due to those years (before 2014) and (those prices) have come down since then,” Ward said. “We want to give everybody fair warning; we aren’t putting anything into our budgets for corn and soybeans ARC county payments. Compared to the last two years, (the payout is) going to be next to nothing.”

Photo caption: OSU Extension’s Barry Ward, left, speaks with OFBF’s Jack Irvin about ARC county payments in 2018.

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