Brown said farmers have decisions to make for both 2014 and 2015.

Decisions for 2014 include:

  • Decide between Price Loss Coverage (PLC) or county Actual Crop Revenue (ARC) on commodity by commodity basis or place all covered commodities in farm-level ARC. If PLC is chosen, decide whether to update payment yields. If ARC is chosen, growers are not eligible for SCO starting in 2015.
  • Decide whether to retain or reallocate covered commodity bases.

For 2015

  • Growers will have a range of new insurance products.
  • For cotton, decide between STAX and SCO.
  • Decide between the appropriate levels, if any, of individual insurance to pair with STAX (or SCO).
  • Possible, based on availability/implementation: different coverage levels for irrigated and non-irrigated practices. Enterprise units by practice. Option to update APH yield.

Davis said he’s not certain which program he’ll choose in 2015 but he’s “leaning toward STAX.” With SCO, producers are required to have another insurance product; with STAX they are not but may want to “buy up” coverage to reduce possible income gaps.

Davis intends to maintain his current level of insurance.

He’s also pleased with one particular aspect of the new program that he believes will be a boon to cotton farmers. Producers may exclude from their actual production history any year that the county yield falls below 50 percent of the ten-year county average. “That’s a big advantage,” he said, “and puts a tremendous amount of value in buy-up insurance.”

“This marks a fundamental change in cotton’s safety net,” Brown said, with a “greater reliance on crop insurance products.” Those products will be available in 2015, hence the transition program for 2014.

 

 

Also of interest:

China, farm bill implementation, trade top cotton issues for 2014

National Cotton Council launches regional farm bill educational meetin…

Surviving Farm Bill Changes Part I