Agricultural and Food Policy
 Agri Outlook Radio
Number 183
Policy: New Farm Bill’s 2008 Direct and Counter-cyclical Payment Signup Underway (2:25 minutes)
Audio/Video Script:
Robert Coats, Ph.D.
Extension Economist and Professor
University of Arkansas, Division of Agriculture
New farm bill’s 2008 direct and counter-cyclical payment program signup is
underway.
Signup has begun for the 2008 Direct and Counter-cyclical Payment Program (DCP).
This signup increases producer certainty for the current crop year, coupled with
the option of a timely advance payment. Contracts are available at USDA Service
Centers and signup will continue until September 30, 2008.
USDA's Direct and Counter-cyclical Payment signup follows the June 12
availability of marketing assistance loan and loan deficiency payment (LDP)
provisions, which occurred within three weeks of the farm bill’s commodity title
enactment.
Producers can fill out their 2008 Direct and Counter-cyclical Payment
contract at any USDA Service Center or producers can sign-up online at USDA’s
Farm Service Agency web site.
USDA computes Direct and Counter-cyclical Payments using base acres and
payment yields established for each farm.
On Direct Payments, eligible producers receive direct payments at rates
established by statute regardless of market price. For 2008, eligible producers
may request to receive an advance payment of 22 percent of the direct payment
for each commodity associated with the farm. USDA will issue advance direct
payments as soon as practical after enrollment. Final direct payments will be
issued after October 1, 2008.
On Counter-cyclical payments, they may vary depending on market prices, and
are issued only when an effective price for a commodity is below its target
price (which takes into account the direct payment rate, market price and loan
rate).
This has been Robert Coats Extension Economist University of Arkansas
Division of Agriculture.
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