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Published August 11, 2014, 10:10 AM

Experts say watch for FSA mailings, get landlords in loop

REDWOOD FALLS, Minn. — Farmers should make sure to open and act upon farm program crop base mailings from Farm Service Agency this month, but they should wait as long as possible to choose between the Price Loss Coverage or Agriculture Risk Coverage options in the program.

By: Mikkel Pates, Agweek

REDWOOD FALLS, Minn. — Farmers should make sure to open and act upon farm program crop base mailings from Farm Service Agency this month, but they should wait as long as possible to choose between the Price Loss Coverage or Agriculture Risk Coverage options in the program.

Deb Crusoe, Minnesota state director of the federal FSA, speaking on a farm bill implementation panel at the IDEAg FarmFest near Redwood Falls, Minn., Aug. 5 said her agency is beefing up staffing ahead of the workload in helping farmers this fall.

“We’ve been able to hire a lot of temporary people, as well as some permanent people,” she said. “We lost 20 percent of our workforce over the last three or four years and we’ve gained back quite a few, just recently.”

Crusoe acknowledged, however, that farmers can’t expect as much one-on-one help as they used to.

Talk to FSA now

Michelle Page, an FSA specialist, said mailings went out in late July to farmers telling them what their 2008 to 2012 history is by FSA farm serial number, and what their current bases and counter-cyclical yields are.

Don’t ignore these mailings, says Paul Gorman, a farm financial consultant from North Mankato, Minn. Gorman is concerned about consolidation of FSA offices in the state of Minnesota, and far smaller staffs. He has been advising family farm clients to visit FSA now to get every farm number’s history to start looking them over for information on base acres or yield updates. He also advises farmers to let landlords know they’re going to need help on those changes.

Gorman, who serves mostly clients in south-central Minnesota, is known as a pioneer of the FarmWorks accounting software in the area around 2000.

“The longer we take, the better position we are in,” Gorman said, of the farm program decisions that will lock in for the full five years of the farm bill. “Strategically, the longer you wait to make a decision, the more you know about 2014 prices. That’ll give you a hint on whether to go PLC or ARC.”

Software isn’t out yet for decision-making and is probably not going to be out until October, Gorman said.

“Farmers aren’t going to be sitting at their desk, working those software models probably until after harvest. I’m guessing a lot of sign-up will get done in November and December.”

Many moving parts

Kent Thiesse, vice president for MinnStar Bank of Lake Crystal, Minn., and a former extension service educator, said the program has more moving parts than past farm programs.

“You can sign up for different options on different farm units and even on the farm unit you can sign up for different options,” Thiesse said. “Because the program covers 2014 to 2018, it requires landowner signatures. You get into the southern half of Minnesota — anywhere from 60 to 75 percent of the land is under some type of rental arrangement.”

Thiesse said universities are developing software for analysis and decision aids for farmers.

“The challenge is it’s going to fall right during harvest time,” Thiesse said of sign-up decisions. “Especially this year in the Upper Midwest we’re looking at a long, slow harvest with a lot of corn drying, which will shorten the time a lot of producers have to look at these program options.”

Thiesse will be one of the experts on a series of webinars funded by the Minnesota Soybean Research and Promotion Council, managed by the Minnesota Soybean Growers Association, and sponsored by the Minnesota Association of Wheat Growers and Minnesota Corn Growers Association. Dates are Aug. 14, Aug. 26 and Sept. 11, from 7:30 p.m. to 9 p.m. Register online at www. mnsoybean.org.

Gorman said typically a crop acreage base goes back to the 1980s. Back then, southern Minnesota had more beef and dairy, and farmers would have had a corn, wheat, soybean base, and lesser amounts of wheat and oats bases.”

Update bases again

In 2001, farmers updated base yield and acres and turned as much wheat and oats bases into corn acres as possible.

“Those were used for counter-cyclical payment calculations, but they still went back and used the old un-updated bases for direct payment calculations,” Gorman said. “I don’t think we’re going to run into that problem this time. I think when you update and use your 2008 to 2012 numbers on this update, it’ll be used for all calculations, whether county-ARC, individual-ARC, or PLC.”

Even farmers who updated in 2001 need to do it again now, Gorman said. Some southern Minnesota counties in 2001 had corn yields of 140 bushels per acre, while today those same counties might have 170 bushels per acre.

“This could be the last opportunity to do updates,” Gorman said. “I don’t think we’re going to have another farm bill in the future that is as good for producers as this one. There’s a pretty good safety net here. It’s not the kind of safety net that’s going to let people keep paying $350 an acre for rent, but it’s a safety net that should allow us to run operations.”

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