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The 2014 Farm Act Agriculture Risk Coverage, Price Loss Coverage, and Supplemental Coverage Option Programs' Effects on Crop Revenue

Author

Listed:
  • O'Donoghue, Erik J.
  • Hungerford, Ashley E.
  • Cooper, Joseph C.
  • Worth, Thomas
  • Ash, Mark

Abstract

The 2014 Farm Act provides eligible U.S. farmers with new commodity supports in the Agriculture Risk Coverage (ARC), the Price Loss Coverage (PLC), and the Supplemental Coverage Option (SCO) programs. These programs help producers with revenue losses generally not covered by traditional crop insurance policies. Interactions, both among these programs and between these programs and the Federal Crop Insurance (FCI) program, determine the nature and magnitude of support avail - able to producers. This report provides an analysis of these programs with a focus on how various combinations of the programs impact producer revenue and its variability, producer well-being, and expected program costs. The report finds that these programs’ effectiveness are influenced by historical prices, expected prices, and FCI coverage rates. High historic crop prices combined with low expected prices since the enactment of the 2014 Farm Act led to higher enrollment of producers in the ARC program in 2015 relative to that in the SCO program.

Suggested Citation

  • O'Donoghue, Erik J. & Hungerford, Ashley E. & Cooper, Joseph C. & Worth, Thomas & Ash, Mark, 2016. "The 2014 Farm Act Agriculture Risk Coverage, Price Loss Coverage, and Supplemental Coverage Option Programs' Effects on Crop Revenue," Economic Research Report 262201, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uersrr:262201
    DOI: 10.22004/ag.econ.262201
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    Cited by:

    1. Boussios, David & O’Donoghue, Erik J., 2019. "Potential Variability in Commodity Support: Agriculture Risk Coverage and Price Loss Coverage Programs," Economic Research Report 335302, United States Department of Agriculture, Economic Research Service.
    2. MacLachlan, Matthew & Ramos, Sean & Hungerford, Ashley & Edwards, Seanicaa, 2018. "Federal Natural Disaster Assistance Programs for Livestock Producers, 2008-16," Economic Information Bulletin 276251, United States Department of Agriculture, Economic Research Service.
    3. Motamed, Mesbah & Hungerford, Ashley & Rosch, Stephanie & O’Donoghue, Erik & MacLachlan, Matthew & Astill, Gregory & Cessna, Jerry & Joseph Cooper, 2018. "Federal Risk Management Tools for Agricultural Producers: An Overview," Economic Research Report 276229, United States Department of Agriculture, Economic Research Service.
    4. Boussios, David & Castillo, Marcelo J. & Brewer, Brady E., 2018. "Impact of Counter-Cyclical Payments on Cash Rental Rates," 2018 Annual Meeting, August 5-7, Washington, D.C. 274116, Agricultural and Applied Economics Association.
    5. Turner, Dylan & Tsiboe, Francis & Baldwin, Katherine & Williams, Brian & Dohlman, Erik & Astill, Gregory & Skorbiansky, Sharon Raszap & Abadam, Vidalina & Yeh, D. Adeline & Knight, Russell, 2023. "Federal Programs for Agricultural Risk Management," Economic Information Bulletin 340216, United States Department of Agriculture, Economic Research Service.

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