The Food and Agricultural Policy Research Institute at the University of Missouri today revised its estimates of farm program costs based on the Agriculture Department's Farm Service Agency's recent release of farmers' choices between the Agricultural Risk Coverage (ARC) and Price Loss Coverage (PLC) programs.

Relative to the 2015 baseline, these new estimates show:

• Increased outlays associated with the 2014 and 2015 crops. Especially for corn, expected ARC payments exceed PLC payments in both years, so heavier-than-expected participation in ARC increases total payments. Outlays exceed previous estimates by about $1.8 billion for the 2014 crop and by about $600 million for the 2015 crop.
• Reduced outlays associated with the 2017 and 2018 crops. For several crops, ARC revenue benchmarks and program outlays are likely to decline after 2015. Projected average per-acre PLC payments exceed ARC payments beginning in 2015 for wheat and 2017 for corn, so fewer PLC acres reduces overall outlays, as do reduced crop insurance expenditures caused by lower SCO and STAX enrollment.
• Total payments under major crop programs and crop insurance net indemnities (indemnities minus producer-paid premiums) are projected to average $11.2 billion per year for the 2014-2018 crop years. The corresponding average for the ten previous years was $11.3 billion.

• Food and Agricultural Policy Research Institute — U.S. Crop Program Fiscal Costs: Revised Estimates with Updated Participation Information