the 2014 farm bill

Extension and Outreach/Department of Economics

The 2014 Farm Bill

Ames, IowaMay 31, 2014

Chad HartAssociate Professor/Crop Markets Specialist

[email protected]


Farm Bill Titles

I. Commodities IX. EnergyII. Conservation X. Hort. & Organic Ag.III. Trade XI. LivestockIV. Nutrition XII. Crop InsuranceV. Credit XIII. Commodity

FuturesVI. Rural Development XIV. MiscellaneousVII. Research XV. Trade & TaxesVIII. Forestry


Farm Bill Projected Spending

Projected Spending 2014-2018$489 Billion


Old vs. New Direct Payments (DP) Countercyclical

Payments (CCP) Marketing Loans (LDP) Revenue

Countercyclical Payments (ACRE)

Countercyclical Payments (PLC)

Marketing Loans (LDP) Revenue

Countercyclical Payments (ARC)

New programs, but they have strong similarities to previous programs


Marketing LoansLoan Rates

Set by lawCorn $1.95Wheat

$2.94Soybean $5.00Sorghum $1.95Barley

$1.95Oats $1.39


PLC instead of CCPPrice-based support program

Reference prices establish targets

Works like CCP

Payment rate = Max(0, Reference price – Max(MYA price, Loan rate))

Payment = Payment rate * Payment yield * Payment acres


PLC vs. CCP and DP


ARC instead of ACRERevenue-based support program

Revenues based on 5-year Olympic average yields and prices

Yields and prices have cups (County T-yields and reference prices)

Triggers at county or individual farm level, instead of state level


ARC-County


Producer Choice


Thank you for your time!

Any questions?

My web site:http://www.econ.iastate.edu/~chart/

Iowa Farm Outlook:http://www.econ.iastate.edu/ifo/

Ag Decision Maker:http://www.extension.iastate.edu/agdm/

the 2014 farm bill

Documents