Economic Tidbits

2019 to be Record Breaking

As of June 9, 582,000 acres of corn and 1.13 million acres of soybeans had yet to be planted in Nebraska. Thus, it is likely 2019 will be record setting in terms of the number of prevented planting acres in the state.

The record highs for both corn and soybeans occurred in 2015 when 105,518 acres of corn and 49,918 acres of soybeans were unplanted. Indemnities paid under prevented planted coverage that year amounted to just over $20 million for corn and $10 million for soybeans.

Additional factors are complicating farmers’ decisions this year when it comes to unplanted acres. Prevented planting acres will not qualify for 2019 Market Facilitation Payments (MFP—trade assistance), but prevented planting acres are expected to receive assistance through the disaster relief package recently passed by Congress. Congress appropriated just over $3 billion to help offset producer losses caused by hurricanes, flooding, tornadoes, snowstorms and other natural disasters this and last year. The assistance covers crop losses including “on-farm stored commodities” and “crops prevented from planting in 2019.” The legislation also gives the USDA the authority to compensate producers for livestock losses.

The USDA has yet to release details on how MFP payments and disaster relief will be calculated and distributed. The first round of MFP payments is expected to be distributed in late July or early August. Details on the disaster assistance programs won’t probably be known for several months. Producers with prevented planting acres should discuss their situation with their crop insurance agents to decide the best course of action. Livestock producers with death losses should develop and maintain documentation of the losses. While the assistance provided under the MFP or disaster assistance programs will not make producers whole, the programs can help mitigate the trade and weather blows of 2019.  

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