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Showing posts from August, 2009

ACRE for 2009? More likely for corn and wheat

Kent Olson, Extension Economist

If yesterday's yield and price forecast releases from USDA hold, the potential for a positive ACRE payment rate for Minnesota has increased. This is especially true for corn and wheat. If the low part of the WASDE price forecast becomes reality, we would likely see positive State ACRE payment rates for corn, soybeans, and wheat at current yield estimates.

However, the State payment rate is only the first trigger for an ACRE payment to an individual farm. The individual farm also has to have lower revenue than that farm's benchmark revenue. If a farm is expecting better than average yields from recent years, the farm may not receive a payment even if the State has a revenue shortfall.

And if farmers sign their farms up for the 2009 crop, the farm is enrolled for all four years. If farmers expect normal yields and future prices to be below recent levels, the ACRE program could look very attractive compared to the 20% cut in direct payments. If fut…