09/10/08 Commodity groups write USDA about ACRE price guarantee

Farm and Ranch September 10, 2008 Several commodity organizations and the American Farm Bureau Federation have written Agriculture Secretary Ed Schafer about USDA's implementation of the farm bill's new Average Crop Revenue Election or ACRE program. In the letter the ag groups complained that USDA's plan to make the price guarantee for the first year of ACRE based on 2006 and 2007 prices rather than 2007 and 2008 prices would significantly undermine the viability of the important safety net option. Daren Coppock, CEO of the National Association of Wheat Growers, says it's clear what Congress intended. Coppock: "The congressional language was pretty explicit that the revenue was supposed to be based on the two most current crop years. So by reaching back into 2006 that is not the two most current crop years. That was the point of the letter, look, there might be some others that are murky but on this point congressional intent is pretty clear." Just how much of a difference would there be in the price guarantee if 06-07 were used instead of 07 and 08? Coppock: "We haven't done actual numbers on it but if you look at the price scenario in 2006 versus 2008, which are the years you would either include or drop, the price of wheat is probably more than two times different between those two crop years. So the revenue guarantee will be significant." USDA has not yet made its decision on the base years but Agriculture Secretary Ed Schafer says what the ag groups want would cost taxpayers an additional 12 billion dollars. I'm Bob Hoff and that's the Northwest Farm and Ranch Report on the Northwest Ag Information Network.