Weekly Recap July 26, 2019

Corn closeup

Today, corn continued it’s downward trek, losing 3 to 4 cents. For the week, September futures lost 16 1/4, ending at $4.14 1/2. December corn ended at $4.24 1/2, down 11 1/4 for the week. Soybean prices were a little higher, up about a penny today, with September beans ending at $8.88 3/4, but down 18 1/2 for the week. November futures ended at $9.01, off 18 1/4 for the week. 

The main story this week was the USDA’s release of information about this year’s Market Facilitation Program (MFP) details. Payments will be by the acre, and determined by county. See below for more information about MFP. Other than that, it continues to feel like we’re going slowly and steadily grind lower until the August 12th USDA report without some significant market news about demand. 

MFP provides payments to eligible producers of:

  • non-specialty crops, including alfalfa hay, barley, canola, corn, crambe, dried beans, dry peas, extra-long-staple cotton, flaxseed, lentils, long grain and medium grain rice, millet, mustard seed, oats, peanuts, rapeseed, rye, safflower, sesame seed, small and large chickpeas, sorghum, soybeans, sunflower seed, temperate japonica rice, triticale, upland cotton, and wheat.
  • specialty crops, including almonds, cranberries, cultivated ginseng, fresh grapes, fresh sweet cherries, hazelnuts, macadamia nuts, pecans, pistachios, and walnuts.
  • Dairy and hogs.

MFP provides payments to eligible producers of covered commodities, which includes non-specialty crops, specialty crops, dairy, and livestock. To be eligible for payments, applicants also must either:

  • have an average adjusted gross income for tax years 2014, 2015, and 2016 of less than $900,000; or
  • derive at least 75 percent of their adjusted gross income from farming or ranching.

Producers also must:

  • Comply with the provisions of the “Highly Erodible Land and Wetland Conservation” regulations, often called the conservation compliance provisions.
  • have a farm number with USDA's Farm Service Agency.

Payments are calculated differently by the type of commodity. 

Non-specialty Crops

For non-specialty crops, assistance is based on a single-county payment rate multiplied by a farm’s total plantings of MFP-eligible crops in aggregate in 2019. Those per-acre payments are not dependent on which of those crops are planted in 2019. A producer’s total payment-eligible plantings cannot exceed total 2018 plantings. County payment rates range from $15 to $150 per acre, depending on the impact of unjustified trade retaliation in that county. Acreage of non-specialty must be planted by August 1, 2019 to be considered eligible for MFP payments. 

You can find payment rates for your county here or download a list of all county rates here.

Dairy, Hogs, and Specialty Crops

Dairy producers who were in business as of June 1, 2019, will receive a per hundredweight payment on production history, and hog producers will receive a payment based on the number of live hogs owned on a day selected by the producer between April 1 and May 15, 2019. 

For specialty crops, producers will receive a payment based on 2019 acres of fruit or nut bearing plants.

Rates include:

  • Dairy (milk): $0.20 per hundredweight
  • Hogs: $11 per head
  • Nuts: $146 per acre
  • Cranberries: $.03 per pound at 21,371 pounds per acre 
  • Ginseng: $2.85 per pound at 2,000 pounds per acre
  • Sweet cherries (fresh): $0.17 per pound at 9,148 pounds per acre
  • Table grapes: $0.03 per pound at 20,820 pounds per acre

Cover Crops

Producers affected by natural disasters who filed prevented planting claims then planted an MFP-eligible cover crop, with the potential to be harvested or for subsequent use as forage, qualify for a $15 per acre payment. Acreage of cover crops must be planted by August 1, 2019 to be considered eligible for MFP payments

Payment Timeline

The first payment will be comprised of the higher of either 50 percent of a producer’s calculated payment or $15 per acre. The first payment will be made in mid-to-late August.

MFP payments will be made in up to three tranches (or portions), with the second and third tranches evaluated as market conditions and trade opportunities dictate. If conditions warrant, the second tranche will be made in November, and the third in early January.

As always, contact your local FSA office for more information. Sign up begins Monday, with payments set to start in August. 

Have a great weekend!