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November' 2013

Farm Bill Conference Committee

 

The forty-one members of the U.S. House and Senate Conference Committee, designated to determine a new Farm Bill, are in the process of trying to reach a compromise on the versions of the new Farm Bill that were passed earlier this year by both the Senate and House. There are a lot of major differences in the two versions of the Farm Bill that need to be worked out by the Conference Committee, as well as some other issues that will likely impact the debate. The current Farm Bill extension expired on September 30, 2013, with many programs and provisions set to be discontinued after December 31, 2013, so timing is very critical for this Conference Committee. [ read more ... ]

 

Flexible Lease Agreements For 2014

The strength in corn and soybean commodity prices in the past few years, and the resulting increases in gross crop income per acre, has caused many landlords to significantly increase cash rental rates in recent years. Many crop producers are now facing the prospects of much lower crop prices for the next few years, and fear that the gross income per acre in coming years may not be high enough to justify the higher cash rental rates that are currently being charged. In addition, crop input costs for seed, fertilizer, chemicals, fuel, and crop drying are not projected to decline much in 2014, as compared to the 2013 crop year, and in fact some expenses may even increase for 2014. An alternative to the proposed high cash rental rates for 2014 and beyond, may be for producers and landlords to consider a “flexible cash lease” rental agreement, which allows the final cash rental rate to vary as crop yields and market prices vary, or as gross revenue per acre exceeds established targets. [ read more ... ]

 

2013 Crop Insurance Calculations

With Federal Crop Insurance, every year is different, and with the multiple options available to producers, there are many variable results from crop insurance coverage at harvest time. 2013 will be no different, with some producers choosing Yield Protection (YP) policies (yield only) versus Revenue Protection (RP) policies (yield and price), and also having differences in the level of coverage chosen, “optional units” or “enterprise units”, etc. that affect final insurance payments. [ read more ... ]

 

November 8 USDA Reports

As expected, the USDA Report released on November 8 increased the estimated total corn and soybean production in 2013. Crop production estimates were raised, despite many areas of Iowa, Minnesota, and the Upper Midwest dealing with very late planting, along with some late season drought conditions. However, overall 2013 crop conditions in the U.S. were better than expected, with many areas benefiting from some very favorable weather in late Summer, and the extended growing season in the Upper Midwest enhanced some of the later planted crops. The changes in the November crop production figures were a bit more dramatic than normal due to the fact that no October USDA Reports were issued, as a result of the Federal Government shutdown in early October. [ read more ... ]