A limited number of farmers in the Upper Midwest received any 2017 farm program payments during October from the USDA Farm Service Agency.
Most crop producers in Minnesota and surrounding states are enrolled in the county yield-based Ag Risk Coverage (ARC-CO) farm program choice on their corn and soybean base acres, which is based on both crop yields and prices. The Price Loss Coverage farm program option is a price-only program that is based on national crop prices, which is more popular for wheat and other small grain crops.
The market year average (MYA) price for a given crop year is used to calculate any potential payments for the PLC and ARC-CO programs. The historical MYA prices are also used to determine the benchmark revenues for the ARC-CO program option. The MYA price for a given commodity is not based on the Chicago Board of Trade (CBOT) commodity prices, or any specific local or terminal grain prices.
The MYA price is the 12-month national average price for a commodity, based on the average market price received at the first point of sale by farm operators across the United States.
The 12-month marketing year for corn and soybeans begins on Sept. 1 in the year that a crop is harvested, continuing through Aug. 31 the following year, with the MYA price finalized on Sept. 30. For the 2017 crop year, the period to determine the final 2017-2018 MYA price was from Sept. 1, 2017, through Aug. 31, 2018..
The final 2017-18 MYA prices are $3.36 per bushel for corn, $9.33 per bushel for soybeans, and $4.72 per bushel for wheat.
USDA is estimating that approximately $3 billion will be paid in total 2017 farm program payments for all crops in the ARC-CO and PLC programs during October.
PLC payments were made on any crop that had a final 2017-18 MYA price lower than the established reference price for that crop. This included corn with a MYA price of $3.36 per bushel, compared to a reference price of $3.70 per bushel, resulting in a PLC payment rate of 34 cents per bushel. Wheat had a final MYA price of $4.72 per bushel, compared to a reference price of $5.50 per bushel, resulting in a 2017 PLC payment of 78 cents per bushel.
There were no 2017 soybean PLC payments because the final 2017-18 soybean MYA price was $9.33 per bushel, compared to a reference price of $8.40 per bushel.
Only five Minnesota counties — Cass, Lake of the Woods, Marshall, Pennington and Roseau — received 2017 ARC-CO payments for corn. Most counties in the western two-thirds of North and South Dakota received 2017 corn ARC-CO payments. A few counties in southern Iowa and northern Wisconsin received 2017 corn ARC-CO payments.