The USDA Farm Service Agency (FSA) announced today the 2017 Price Loss Coverage (PLC) payment rates for long-grain and medium-grain rice. The Agricultural Act of 2014 (aka 2014 Farm Bill) provides payments for covered commodities enrolled in PLC when the Marketing Year Average (MYA) price is below the statutory Reference Price.
The PLC Payment Rate is calculated by subtracting the higher of the Loan Rate or the Marketing Year Average price from the Reference Price.
PLC payments for the 2017 rice crop are expected to be made in November 2018. Payments made under the PLC program are subject to a payment limitation of $125,000 per person. As a reminder, PLC payments are decoupled from actual production.
Payment Yields used for PLC could be either 90% of actual farm yields for the years 2008 through 2012 or 75% of the county average yields for that time period. Price Loss Coverage payments are also decoupled from actual planted acreage—that is, payments are made on 85% of a crop’s historical “base” acres rather than actual acres planted or harvested.
The table below provides details of how the 2017 rice PLC payment rates are calculated. As in previous years, the 2017 ARC and PLC payments will be subject to sequestration. After adjusting for the 6.8% sequestration, the net PLC payment rates for long-grain and medium grain would be $1.05 and 96 cents per bushel respectively.
The complete news release from the Farm Service Agency can be downloaded here.
|Dollars Per Bushel|
|National Loan Rate||$2.93||$2.93|
|Higher of Loan Rate or MYA Price||$5.175||$5.265|
|PLC Payment Rate
(reference price – MYA)