Extension and Ag Research News


ACRE Payment for 2009 Wheat in N.D. Appears Unlikely

An average yield for North Dakota of more than 40 bushels per acre would result in no ACRE payment for wheat.

The decision to elect the Average Crop Revenue Enrollment (ACRE) program or to stay with the Direct and Counter-cyclical Payment program became a little clearer for some producers with the yield projection from the spring wheat quality tour.

The estimated average yield for North Dakota spring wheat from this survey is in the mid- 40 bushel range, which is more than 20 percent above the five-year Olympic average yield used in the 2009 state ACRE guarantee for wheat. The National Agricultural Statistics Service will determine the actual yield for 2009 after the crop is harvested and this yield figure will be used for determining any ACRE payments. However, the high estimate from the wheat quality tour suggests the state yield may well be high enough to offset the expected price decline.

“Based on the latest price estimate from the U.S. Department of Agriculture for the 2009 wheat crop, an average yield for North Dakota of more than 40 bushels per acre would result in no ACRE payment for wheat,” says Dwight Aakre, North Dakota State University Extension Service farm management specialist. “Producers with farm units that are primarily planted to wheat this year may be better off delaying ACRE enrollment until 2010 or later.”

The exception to this would be farms that have at least 25 percent to 30 percent of the acreage planted to crops that appear more likely to earn an ACRE payment this year. These crops include flax, sunflowers and dry peas. Other crops, such as corn, soybeans and barley, also may be eligible for ACRE payments for 2009, but the outcome is less certain.

“Corn, soybeans and barley are a tougher call in North Dakota,” Aakre says. “The projected national average prices for 2009 for these crops are down from the two-year average price used to calculate the state guarantee, but not low enough to trigger a payment without some drop in yield below the five-year average. It seems unlikely that the state barley yield will be down when the state wheat yield is expected to be considerably above average.”

The state average yield for corn and soybeans is very much in question at this point in the growing season. Accumulated growing degree days are behind normal for these crops. These crops also have been planted later than normal. Will this translate into a below average yield for these two crops? If yields are below average, there likely will be ACRE payments for both crops.

“The forecasted price for corn is about 10 percent below the two-year average price and down about 7 percent for soybeans,” Aakre says. “Therefore, it will take some reduction in yield to result in ACRE payments for corn and soybeans. That outcome is looking more likely every day that our cooler-than-normal temperatures continue.”

NDSU Agriculture Communication

Source:Dwight Aakre, (701) 231-7378, dwight.aakre@ndsu.edu
Editor:Rich Mattern, (701) 231-6136, richard.mattern@ndsu.edu
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