Signup for the Direct and Counter-cyclical Program (DCP) is currently underway and will continue through June 1, 2010. DCP provides payments to producers on farms that are enrolled for 2008 through 2012. Signup is on an annual basis and interested producers must sign up every year.

There are two types of DCP payments: direct payments and counter-cyclical payments. Both are
calculated using base acres and payment yields established for the farm. Eligible commodities include: wheat, barley, oats, corn, grain sorghum and soybeans. There are others, but none of them are raised in this area. There is a provision that farms with 10 base acres or less are not eligible for payments,
however, if the farm is at least 50 percent owned by a socially disadvantaged producer (generally, women or minorities) the farm can still be eligible.

DIRECT PAYMENTS – are payments that are made regardless of crop prices. For 2010, the direct payment for a farm is calculated as 83.3 percent of the farm’s base acres, times the farm’s payment yield, times the payment rate for the crop. Payment rates for 2010 on a per bushel basis are: wheat – 52¢, barley - 24¢, oats – 2.4¢, corn - 28¢, grain sorghum - 35¢ and soybeans - 44¢.

COUNTER-CYCLICAL PAYMENTS – are payments that are made in addition to direct
payments in the event of low crop prices. Counter-cyclical payments for a commodity are only issued if the effective price for a commodity is below the target price for the commodity. Target prices for 2010 on a per bushel basis are: wheat - $4.17, barley - $2.63, oats - $1.79, corn - $2.63, grain sorghum - $2.63 and soybeans - $6.

Producers signing up in DCP can request a 22 percent advance of the direct payment and the rest will be paid in October, or they can opt to get the whole direct payment in October. Please don’t forget the signup deadline of June 1, 2010.
Producers who are eligible to sign up for DCP are also eligible to sign up for the Average Crop Revenue Election Program (ACRE), except that, unlike DCP, there not only has to be a base on the farm, but the producer must also be raising the crop on the farm. Raising the crop is not required for DCP.
Farms already enrolled in DCP can switch to ACRE, but once a farm is enrolled in ACRE it cannot switch back to DCP.

A farm’s payment is based on a revenue guarantee calculated using a five-year average state yield and the most recent two-year national price for each eligible commodity. For 2010, the two-year price average will be based on the 2008 and 2009 crop years.

An ACRE payment is issued when both the state and the farm have incurred a revenue loss. The actual state revenue for the program year must be less than the state ACRE guarantee and the participating farm’s actual farm revenue for the program year must be less than the farm ACRE guarantee.

The payment is based on 83.3 percent of the farm’s planted acres times the difference between the state ACRE guarantee and the state revenue times the ratio of the farm’s yield divided by the state expected yield. The total number of planted acres for which a producer may receive ACRE payments may not exceed the total base on the farm. In exchange for participating in ACRE, in addition to not receiving
counter-cyclical payments, a farm’s direct payment is reduced by 20 percent, and commodity loan and LDP rates are reduced by 30 percent.

Enrolling in ACRE is irrevocable. The owner of the farm and all producers on the farm must agree
to enroll in ACRE. Once enrolled, the farm shall be enrolled for that crop year and will remain in ACRE through the 2012 crop year.

The deadline to enroll in either DCP or ACRE is June 1, 2010.