The right fit: Time to enroll in ARC, PLC programs

WEST LAFAYETTE, Ind. — The deadline to enroll for Agriculture Risk Coverage or Price Loss Coverage is March 15.

The programs provide financial protection from substantial drops in crop prices or revenues.

“If you go back to the 2014 bill, most farmers chose the ARC-CO program for both corn and soybeans,” said James Mintert, director of the Center for Commercial Agriculture at Purdue University, during a webinar.

“The situation this time is different. For most of you, you don’t want to do exactly what you did in the 2014 bill. You do need to do some additional analysis and think about what you want to do.”

This year, the PLC program is much more competitive for corn, he said.

For folks in the Eastern Corn Belt, the Agriculture Risk Coverage Individual program could fit in some situations.

“Our analysis would suggest that if you have an FSA farm with a 20% production loss in 2019 that could be from prevented planting, reduced yields or a combination of both, then it’s worth taking a look at,” Mintert said.

“If those losses get bigger than 20%, at that point it starts looking attractive. It gets tricky if you’re looking at multiple FSA farms, then you’ve got to consider the averaging of the benchmark revenues across farms. It’s a little more complicated.”

Program Sign-up Process

Kaitlin Myers, state agricultural program specialist at Indiana Farm Service Agency, said that the sign-up process consists of three tasks.

1. Yield update: An owner can update PLC yields — October 2019 to Sept. 30, 2020.

2. Election: Election of PLC, ARC-CO or ARC-IC can be completed prior to yield updates — September 2019 to March 15, 2020, for 2019.

3. Enrollment: Once election has been completed, then enrollment takes place — September 2019 to March 15, 2020, for 2019.

“Another important thing to note is that the election and enrollment must be completed by March 15, otherwise that farm will receive a default election,” Myers said.

“The default election is the current election on the farm from the 2014 farm bill. When that default election is made, no payments will be issued on that farm for 2019. Those are the ramifications of not meeting that deadline.”

So far, very few Hoosiers have completed their applications.

“It’s really important to make your appointment early, get that paperwork done, and if they make an election now and change their mind later, they can always change their election up until that deadline,” Myers said.

The bottom line, Mintert said, is that each farmer needs to crunch numbers in order to find the best option for their operation.

The University of Illinois has a spreadsheet that calculates Agricultural Risk Coverage for County Coverage and Price Loss Coverage payments. Check it out at farmdoc.illinois.edu/crop-insurance.

Learn more about crop insurance options at www.fsa.usda.gov/programs-and-services/arcplc_program/index.

In a nutshell

Farm bill decision-making tips

1. Compare updated yields to existing program yields for each crop and FSA farm.

2. Make your program choices:

• Corn and wheat: Start with PLC as your initial program choice and evaluate ARC-CO as a challenger.

• Soybeans: Start with ARC-CO as your initial program choice and evaluate PLC as a challenger — consider ARC-IC on FSA farms with significant production losses of at least 20% or more in 2019.