Farm Service Agency to Use 2007 and 2008 Season Average Prices for Revenue Guarantee

The American Soybean Association (ASA) today applauded the announcement of details for sign-up under the Average Crop Revenue Election (ACRE) Program by U.S. Department of Agriculture (USDA) Secretary Ed Schafer because USDA has decided to use 2007 and 2008 Season Average Prices (SAP) in determining the revenue guarantee for the ACRE Program. ASA strongly advocated for the use of 2007 and 2008 SAPs because this will provide soybean farmers with a revenue guarantee about $71.00 higher per acre than if USDA had used 2006 and 2007 SAPs for soybeans.

"ASA supported development of the ACRE Program as an alternative to the traditional farm program in the 2008 Farm Bill," stated ASA President Johnny Dodson, a soybean producer from Halls, Tennessee. "We are particularly pleased by the Department’s decision to use Season Average Prices for 2007 and 2008 in determining the revenue guarantee for the ACRE Program."

According to Dodson, "this decision will provide an average revenue guarantee of $422.00 per acre for 2009 crop soybeans, based on a national average yield of 41.7 bushels per acre on planted acres." The ASA President added that "this will make ACRE a viable program option for many soybean farmers in 2009 and beyond."

Dodson’s comments followed release of details for sign-up under the traditional Direct and Counter-Cyclical Payment (DCP) Program, which began on December 22, and will continue through June 1, 2009. Producers who sign-up may request an advance Direct Payment equal to 22 percent of the DP for each commodity on a farm. Sign-up for the optional ACRE program will begin in the spring. Producers are allowed to sign-up for the DCP Program, receive the advance DP, and then elect to sign-up for ACRE. Once a farm is enrolled in ACRE, the decision is irrevocable through the 2012 crop year, after which the 2008 Farm Bill will expire.

"Based on the Season Average Price for 2007 soybeans of $10.70/bu. and the current ERS estimated SAP of $9.85/bu. for 2008, the revenue guarantee for 2009 crop soybeans will be based on an average two-year price of $10.13 per bushel," Dodson continued. "Based on average yields, the guaranteed price of $422.00 per acre is $71.00 higher than the level that would have applied if USDA had used 2006 and 2007 SAPs for soybeans.

"ASA urges all soybean producers to examine the ACRE Program carefully in deciding which safety net best serves to protect their farm income," Dodson concluded.

ASA is the policy advocate and collective voice of its 22,000 producer-members on domestic and international issues of importance to all U.S. soybean farmers. Estimates are that approximately 75 million acres of soybeans will be planted in the United States in 2009.