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Impacts on South Plain Farmers

:. Impacts on South Plain Farmers. For Cotton/lb. Old or new program Prod. CCP. $0.724. FP. $0.0667. Old program prod. LDP. Current Prod. $0.52. Market Price. Target Price. Loan Rate. Government Payment Mechanism Under New Farm Bill.

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Impacts on South Plain Farmers

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  1. : Impacts on South Plain Farmers

  2. For Cotton/lb Old or new program Prod. CCP $0.724 FP $0.0667 Old program prod. LDP Current Prod. $0.52 Market Price Target Price Loan Rate Government Payment Mechanism Under New Farm Bill

  3. Loan Rate, Direct Payments and Target Prices Under FSRI Act

  4. Peanut • Provides a quota buyout of 11 cents per pound for five years. • Provides a target price of $495/ton • Provides a loan rate of $355/ton • Provides a fixed payment of $36/ton

  5. Updating Base Acres and Program Yield • Base Acres: Allows producers to retain their current AMTA base acres and add oilseed acres or to update base acres using 1998-01 acres planted. • Program Yield: Allows Producers who update base acreage to the average of 1998-01 planting to update yields for counter cyclical payment.

  6. Payment Limitations • Limits on direct payments: $40,000/person. • Limits on counter cyclical payments:$65,000/person. • Limits on LDPs and MLGs:$75,000/person. • Retain current rules on spouses and 3-entities. ----------------------------- Total Dollar limitation: $360,000. • Adopts a 2.5 million dollars adjusted gross income cap on eligibility of participation.

  7. Overall Impacts at the National Level (FAPRI) • Increase in net outlays on commodity program: • FAPRI: 49.7 Billion dollars over the next ten years. • CBO: 47.7 billion dollars over the next ten years. • Net outlays on conservation programs increase by 13 billion dollars. • Slight increase in total area: Increase in grain and cotton area more than offset decrease in soybean area. • Grain and oilseed price fall while oilseed price rise marginally. • Net farm income increase by an average of 3.8 billion dollar per year

  8. Impacts on U.S Crop Area million acres *Includes wheat, corn, barley, sorghum, rice, oats, soybean, and sunflower

  9. Per Pound Cotton Gross Return (FAIR vs FSRIA) $/lb

  10. Total Cotton Gross Return for Lubbock County Million $

  11. Projected Government Payments for Cotton( Lubbock County) Million $ *Includes LDP, Fixed and CCP

  12. Total Cotton Gross Return for Lubbock & Surrounding Counties Million $

  13. Projected Government Payments for Cotton (Lubbock and Surrounding Counties) Million $

  14. Projected Counter Cyclical Payments for Cotton (Lubbock and Surrounding Counties) Million $

  15. Sorghum

  16. Projected Government Payments for Sorghum (Lubbock County) 000 Dollars *Includes LDP, Fixed and CCP

  17. Estimated Government Payments for Sorghum (Lubbock and Surrounding Counties) 000 Dollars

  18. Concluding Remarks • Will the new farm bill solve the current farm crisis? • Answer depends on your definition of farm crisis. • If you define farm crisis as excess production and low prices, then the answer is no. • If you define farm crisis as low farm income, then the answer is yes. • Is it good for south plain farmers? • Total cotton net return for the country is projected to increase by 700-800 million dollar per year • Cotton gross return is likely to increase by $0.10 per pound per year.

  19. Concluding Remarks • Is it good for Lubbock economy?: • Annual increase of around 30 million dollars in cotton gross return for Lubbock county. • And 218 million dollars for Lubbock and surrounding counties • Annual increase of 300 thousand dollars of additional government payments for sorghum to Lubbock county. • And two million dollars for Lubbock and Surrounding counties.

  20. What it means for future of agriculture in the region?

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