What's up at the FSA Office?
By Cindy Mensen, Acting Allamakee County Executive Director (563) 568-02148
ATTENTION FARMERS - REMINDER:
Sept 1: Premiums are due for 2016 MPP buy-up coverage
Sept 30: Deadline to complete CCC-782 for 2017 MPP-Dairy coverage
MPP-Dairy payments made for May/June period
Area dairy producers who chose MPP-Dairy coverage at the $6.00 or higher level recently received an MPP payment. The National Agricultural Statistics Service (NASS) reported the All Milk price for May was $14.50 and for June was $14.80. Those prices are averaged and then the feed costs for alfalfa hay, corn and soybean meal are compiled into a “Final Feed Cost” which was reported as $8.72797 for May and $9.04648 for June. These price statistics resulted in a milk margin of $5.76277 for the two month period.
MPP-Dairy signup
Dairy producers who made the decision for “buy-up” insurance coverage for the Margin Protection Program-Dairy (MPP) in 2016 are reminded that premiums for the 2016 coverage year are due by September 1st.
Also, all participants in the MPP-Dairy are encouraged to stop in at FSA and make their 2017 MPP coverage decision. MPP-Dairy replaced the MILC program and is effect through December 31, 2018. The Margin Protection Program offers dairy producers: (1) catastrophic coverage, at no cost to the producer, other than an annual $100 administrative fee; and (2) various levels of buy-up coverage. Farmers choose the level of coverage that meets their operation needs. Catastrophic coverage provides payments to participating producers when the national dairy production margin is less than $4.00 per hundredweight (cwt). Producers may purchase buy-up coverage that provides payments when margins are between $4.00 and $8.00 per cwt. To participate in buy-up coverage, a producer must pay a premium that varies with the level of protection the producer elects. The national dairy production margin is the difference between the all-milk price and average feed costs.
An administrative fee of $100 will be collected at the time of 2017 sign-up and the buy-up premiums are due later in 2017.
Marketing Loans
What will you do with your bountiful harvest this fall? If you are not ready to sell your crop at harvest, or you want to keep your grain to later feed it, you may want to consider the marketing loan program at the Farm Service Agency. Marketing loans allow the storage of grain to be at your farm or at an approved warehouse. The grain remains in your ownership and you can use it as collateral for a corn or soybean loan. Loans are for nine months and interest rates are very low. 2016 loan rates for Allamakee County are Corn: $1.87 and Soybeans $4.99.
Marketing loans (MAL) and Loan Deficiency Payments (LDP) are marketing tools available to producers beginning upon harvest or shearing. The MAL provides interim financing at harvest time to help agricultural producers meet cash flow needs without having to sell their commodities when market prices are typically at harvest-time lows, allowing the producer to delay the sale of the commodity until more favorable market conditions emerge. Allowing producers to store production at harvest (or at shearing in the case of wool and mohair) also provides for a more orderly marketing of commodities throughout the year. MALs for commodities are considered “nonrecourse” because the loan can be redeemed by repayment, or by delivering the agricultural commodity that was pledged as collateral to the Commodity Credit Corporation (CCC) as full payment for the loan upon maturity.
Loan deficiency payments – LDPs- are available when the posted county price is lower than the loan rate. When the market price is that low, farmers may lock in an LDP rate for grain they have already harvested and still own (retain beneficial interest). If the prices drop further and LDPs become a reality for corn and soybeans, please remember to stop at the FSA office and sign form CCC-633 prior to selling any grain. Currently, Hard Red Winter Wheat prices are at a level to receive an LDP.
