U.S. Farm Commodity Support: Base Acres and Payment Yields

U.S. Farm Commodity Support: Base Acres and Payment Yields

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May 31, 2023
U.S. Farm Commodity Support: Base Acres and Payment Yields
The Agriculture Improvement Act of 2018 (2018 farm bill;
were eligible for support through a different mechanism.
P.L. 115-334) reauthorized the Price Loss Coverage (PLC)
Farmers received base acre allocations in proportion to their
and the Agriculture Risk Coverage (ARC) programs for
1981-1985 plantings. The Farm Security and Rural
crop years 2019-2023. These programs provide income
Investment Act (2002 farm bill; P.L. 107-171), the Food,
support to producers of certain eligible commodities. The
Conservation, and Energy Act of 2008 (2008 farm bill; P.L.
amount of support varies by commodity and from year-to-
110-234), and the Agricultural Act of 2014 (2014 farm bill;
year based on program enrollments and market conditions.
P.L. 113-79) changed the list of eligible commodities,
The U.S. Department of Agriculture (USDA) administers
added new base acres for oilseed and pulse crops, and
PLC and ARC. For additional information about these
allowed for producers to make voluntary changes to their
programs, see CRS Report R45730, Farm Commodity
base acre commodity allocations.
Provisions in the 2018 Farm Bill (P.L. 115-334).
Table 1. Millions of Total Base Acres, Enrolled Base
USDA calculates payments from the PLC and ARC
Acres, and Planted Acres, by Commodity
programs based on a farm’s enrolled base acres and
payment yields. Base acres and payment yields are units of
Total
Enrolled
Total
production that Congress authorized USDA to give to
Covered
Base
Base
Planted
eligible producers at specific points in time and in
Commodity
Acres
Acres
Acres
proportion to the farm’s historical production of certain
Barley
6.23
5.39
2.79
commodities. Providing PLC and ARC payments per base
acre and payment yield—as opposed to per planted acre or
Corn
100.74
94.81
90.56
per harvested quantity—decouples payments from annual
Cotton (Seed)
13.86
11.38
12.70
production. Prior to the 1990s, commodity support
programs provided payments based on annual production,
Oats
2.67
2.09
2.74
which incentivized farmers to plant crops based on program
Minor Oilseeds
3.55
3.46
4.18
payments instead of market conditions. Decoupling
commodity support from planting decisions has been a goal
Peanuts
2.60
2.46
1.53
of agricultural policy since the 1990s and helps fulfill U.S.
commitments under the World Trade Organization (WTO)
Pulses
0.85
0.82
1.95
Agreement on Agriculture. As it considers the next farm
Rice
5.01
4.65
2.59
bill, Congress may consider changes to the PLC and ARC
programs and base acre and payment yield allotments.
Sorghum (Grain)
9.83
8.65
6.19
Base Acres
Soybeans
55.84
53.55
83.52
Base acres and payment yields are associated with specific
Wheat
69.72
63.28
45.60
tracts of farmland. USDA allocated these units to eligible
Total
270.90
250.55
254.36
farmers in proportion with historical production in
accordance with 7 U.S.C. §9011. Base acre allocations may
Source: CRS calculations using USDA Farms Service Agency (FSA)
transfer to the new owner when the associated land is sold.
program records and USDA National Agricultural Statistics Service
Landowners can reallocate base acres between tracts of land
(NASS) Quick Stats database.
owned by the same farm under certain conditions.
Notes: Total base acres are values for the 2021 crop year and
Landowners may permanently reduce their base acres
exclude acres without a commodity allocation. Enrol ed base acres
voluntarily at any time and are required to reduce base acres
and total planted acres are averages for the 2019-2022 crop years.
associated with land that is permanently removed from
Enrol ed base acres participate in the Agricultural Risk Coverage
agricultural production (e.g., land sold for redevelopment).
Program or the Price Loss Coverage Program. Minor oilseeds include
Statute requires USDA to ensure that a farm’s total base
canola, crambe, flaxseed, mustard seed, rapeseed, safflower, sesame,
acres do not exceed the farm’s actual cropland acreage,
and sunflower seed. Pulses include large and smal chickpeas, dry
with limited exceptions.
peas, and lentils. Rice includes long, medium, and japonica varieties.
USDA originally allocated base acres to farmers for
The 2014 farm bill excluded cotton as a covered
specific commodities (i.e., covered commodities) (Table 1).
commodity in response to a WTO dispute settlement case
In the Federal Agriculture Improvement and Reform Act of
with Brazil. Cotton base acres were renamed generic base
1996 (1996 farm bill; P.L. 104-127), Congress granted base
acres, and farms with generic base acres were potentially
acres—then called “contract acres”—for wheat, corn, grain
eligible for PLC and ARC payments if they planted eligible
sorghum, barley, oats, cotton, and rice. At the time, peanuts
crops on land associated with generic base acres. The
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U.S. Farm Commodity Support: Base Acres and Payment Yields
Bipartisan Budget Act of 2018 (P.L. 115-123) added seed
and/or past years of relatively good harvests. A mandatory
cotton as a covered commodity and required farmers to
update of payment yields based on recent actual yields
convert their generic base acres into either a covered
would require USDA to reduce certain payment yields and
commodity or unassigned base acres.
increase payment yields for other commodities. A voluntary
update of payment yields would allow farmers to retain
In total, there were more total base acres in 2021 than
certain existing payment yields while updating payment
average acres planted with covered commodities in 2019-
yields for other commodities.
2022 and more average acres planted than enrolled in PLC
and ARC (Table 1). Barley, corn, grain sorghum, peanuts,
Figure 2. Ratio of Average Payment Yield to Actual
rice, and wheat had more average enrolled base acres than
Yield by Commodity, 2019-2022
planted acres—reflecting farmers’ preferences for
maintaining base acre allocations to crops grown
historically on the land and changes in planting patterns
after 2018 in response to market conditions. Farmers may
prefer to maintain base acre allocations to certain crops due
to variations in average PLC and ARC payments across
commodities (Figure 1).
Figure 1. Average Total PLC and ARC Payments per
Enrolled Base Acre by Commodity, 2019-2022

Source: CRS calculations using USDA FSA program records and
USDA NASS Quick Stats database.
Note: Actual yields not available for crambe, seed cotton, or sesame
seeds.
Issues for Congress
Base acres and payment yields are long-standing features of
agricultural commodity support policy. Since the 1990s,
Congress has expanded the list of commodities available for
support and given farmers opportunities to voluntarily
Source: CRS calculations using USDA FSA program records for the
update their base acres and payment yields at specific
2019-2022 crop years and Congressional Budget Office estimates for
points in time. Farmers who began producing covered
ARC and PLC payments for the 2022 crop years.
commodities after the last time new base acres were granted
Note: Mustard seed, oats, japonica rice, safflower, sesame seed, and
may be ineligible for PLC or ARC due to lack of base
sunflower seed each averaged less than $2 per base acre per year.
acres. Farmland with base acres may be more expensive to
purchase or rent than farmland without base acres due to the
Base Acre Enrollment in PLC and ARC
potential to receive PLC and ARC payments. Limited
Base acre allocations do not need to match planted acre
resource farmers may be at a competitive disadvantage to
allocations in order to enroll in PLC or ARC. Statute
rent or purchase land with base acres. Producers of color
requires reductions in PLC and ARC payments if farmers
are less likely to own base acres than other producers due to
plant fruits, certain vegetables, and/or wild rice on land
a variety of factors, including smaller average land holdings
with associated base acres. Farmers—except socially
and a tendency to specialize in production of non-covered
disadvantaged, limited resource, veteran, and beginning
commodities. For additional background on producers of
farmers—must have at least 10 base acres to be eligible to
color, see CRS Report R47066, Racial and Ethnic Equity in
receive PLC or ARC payments. Base acres associated with
U.S. Agriculture: Selected Current Issues.
land enrolled in the Conservation Reserve Program (CRP)
cannot be enrolled in PLC or ARC. Total base acre
Agricultural stakeholder groups assert that additional grants
enrollments in PLC and ARC may vary from year to year
of base acres, additional voluntary commodity
due to many factors, including changes in CRP enrollments.
reallocations, and/or payment yield updates could increase
the usefulness of the PLC and ARC programs for
Payment Yields
producers. Funding additional base acres and/or payment
Payment yields are a farm’s average historical yield per
yield increases could increase the costs of the PLC and
acre per covered commodity and can be based on yields
ARC programs, which may require additional funding or
from the 1980s. Actual yields have increased on average
reductions for other farm bill priorities. Congress may
since the 1980s with changes in seed genetics and other
consider the impacts of mandatory or voluntary updates of
innovations. Congress allowed farmers to voluntarily
existing allocations.
update their payment yields in the 2002 farm bill, the 2014
farm bill, and the 2018 farm bill. Some commodities have
Stephanie Rosch, Analyst in Agricultural Policy
average payment yields that are greater than recent average
Christine Whitt, Research Associate
yields (Figure 2) because of recent relatively poor harvests
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U.S. Farm Commodity Support: Base Acres and Payment Yields

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