Expected ACRE Payments Update With NASS Yields[1]

National Agricultural Statistics Service (NASS) released their updated Marketing Year Average (MYA) price and their first estimated yields split by irrigation and non-irrigation at the end of February. NASS did not release estimated yields for irrigated Idaho wheat, New Mexico wheat, Delaware corn, and Arkansas corn. So the estimated ACRE payments on those crops are still based on KSU estimated irrigated and dryland yields.

Because the NASS irrigated and dryland yields were released for the other crops those yields are near final. There will still be some adjustment to the MYA price on the spring planted crops but the MYA price for wheat only has 2 1/2 months left in the marketing year so the wheat price is nearly complete. The most current price-yield estimates now show an ACRE payment on Kansas wheat. While many farmers in Kansas did not elect ACRE, if they had many wheat farmers would not be able to meet the farm level benchmark because of record wheat yields. If farmers cannot meet the farm level benchmark then they will not collect the ACRE payment even when the state triggers a payment. KSU is currently estimating no Kansas ACRE payments for irrigated corn, dryland corn, sorghum or soybeans.

Those Kansas wheat farmers with farm level losses may be able to collect SURE payments and any ACRE payment is deducted from the SURE payment. Therefore, any Kansas wheat farmer collecting 2009 SURE payments who did not elect ACRE will receive a larger SURE payment and Direct Payment. Therefore, the �loss� of the ACRE payment will be smaller than one might think. The reason is the ACRE payment on Kansas wheat will likely be less than $10. The ACRE payment will be 4 times larger on Oklahoma and Texas wheat and nine times larger on Washington wheat.

The large wheat ACRE payment for Oklahoma, Texas, and Washington is still expected. The estimated no wheat ACRE payment for Colorado also holds. Texas ranks first as most likely to collect ACRE payments on all 4 crops. The only exception is Texas irrigated corn where no ACRE payment is now forecasted. The Texas NASS irrigated corn yield was 11% higher than the KSU forecast and when combined with the higher MYA corn price eliminated the payment.

There were some surprises. Illinois is expected to receive ACRE payments for corn, sorghum, and wheat but none for soybeans. In spite of the reduction in the NASS Iowa corn yield from August, the post harvest prices have increased enough to eliminate the corn ACRE payment for Iowa. KSU never forecasted an ACRE soybean payment for Iowa.

The tables below contain estimates for ACRE payments by crops and by state. There will be no NASS irrigated yields published for many of the states, so the Farm Service Agency (FSA) will estimate those yields.

Table 1. ACRE Wheat Estimated 2009/10 Payments ranked in order of States most likely to make ACRE payments. Payments are capped at 25%. Idaho and New Mexico with irrigated and non-irrigated practice are estimated yields all other yields are NASS estimates.

Table 2. ACRE Corn Estimated 2009/10 Payments ranked in order of States most likely to make ACRE payments. Payments are capped at 25%. Delaware and Arkansas with irrigated and non-irrigated practice are estimated yields all other yields are NASS estimates.

Table 3. ACRE Soybean Estimated 2009/10 Payments ranked in order of States most likely to make ACRE payments. Payments are capped at 25%. All yields are NASS estimates.

Table 4. ACRE Grain Sorghum Estimated 2009/10 Payments ranked in order of States most likely to make ACRE payments. Payments are capped at 25%. All yields are NASS estimates.

[1]Prepared by G. A. (Art) Barnaby, Jr., Professor, Department of Agricultural Economics, K-State Research and Extension, Kansas State University, Manhattan, KS 66506, March 9, 2010, Phone 785-532-1515, e-mail � barnaby@ksu.edu.