The Agriculture Improvement Act of 2018 initiated an escalator clause for the farm safety net’s reference price. We evaluate how this escalator would have influenced payments by the Price Loss Coverage (PLC) program from 2014 forward, the first crop year PLC was implemented. Five crops with a range of relationships between reference prices and market prices are examined: corn, soybeans, wheat, sorghum, and long grain rice.
원본 콘텐츠
The Agriculture Improvement Act of 2018 initiated an escalator clause for the farm safety net’s reference price. We evaluate how this escalator would have influenced payments by the Price Loss Coverage (PLC) program from 2014 forward, the first crop year PLC was implemented. Five crops with a range of relationships between reference prices and market prices are examined: corn, soybeans, wheat, sorghum, and long grain rice. The escalator would have increased reference prices and thus PLC payment rates for sorghum, wheat, and, especially corn and soybeans over the 2014 farm bill crop years of 2014-2018. There is a very good likelihood that the escalator will increase corn, soybean, and sorghum reference prices starting with the 2024 crop year. The reference price escalator reduces the need to raise statutory reference prices. Overview – Reference Price Escalator The effective reference price for a crop year is the higher of (a) the statutory reference price stated in the 2018 ...