SABIIA - Sistema Aberto e Integrado de Informação em Agricultura (Sabiia)

This paper develops a stochastic model for comparing payments to U.S. corn producers of a revenue-based counter-cyclical payment (R-CCP) that is offered as an alternative in the 2007 House "Farm Bill" (H.R. 2419) to the current price-based CCP (P-CCP). We minimize the potential for miss-specification bias in the model by using nonparametric and semi-nonparametric approaches as specification checks in the model. Using this model, the paper examines the sensitivity of the density function for payments to changes in expected price levels. A mean-variance utility function approach is used to assess producer preferences for choice of CCP program alternative. The results show that as risk reduction instruments at the farm level, there appears to be little...

ACRE: A Revenue-Based Alternative to Price-Based Commodity Payment Programs

Palavras-chave: Domestic support; Counter-cyclical payments; Revenue; Price; Corn; Yield; Pairs bootstrap; Kernel density; Semi-nonparametric; Combinatorial optimization; Agricultural and Food Policy; Crop Production/Industries.

Ano: 2008

URL: http://purl.umn.edu/6197

This paper develops a stochastic model for estimating the probability density function of the Average Crop Revenue Election (ACRE), a revenue-based commodity support payment that is offered under the 2008 Farm Act as an alternative to the traditional suite of price-based commodity payments, that is, marketing loan benefits and counter-cyclical payments. We minimize the potential for miss-specification bias in the model by using nonparametric and semi-nonparametric approaches as specification checks in the model. Our simulation results show that adding ACRE revenue payments to gross revenue reduced the downside risk in revenue for corn, wheat, and soybean farmers in 2009 in the four locations examined, with reductions ranging from 4% to 25%. Integrating...

Economic Analysis of Base Acre and Payment Yield Designations Under the 2002 U.S. Farm Act

Palavras-chave: Domestic support; Average crop revenue election; Loan deficiency payments; Counter-cyclical payments; Revenue; Price; Corn; Yield; Pairs bootstrap; Kernel density; Semi-nonparametric; Combinatorial optimization; Negative exponential utility function; Agricultural and Food Policy; Demand and Price Analysis.

Ano: 2009

URL: http://purl.umn.edu/49180

Young, C. Edwin; Skully, David W.; Westcott, Paul C.; Hoffman, Linwood A..

The 2002 Farm Act provided farmland owners the opportunity to update commodity program base acres and payment yields used for calculating selected program benefits. Findings in this report suggest that farmland owners responded to economic incentives in these decisions, selecting those options for designating base acres that resulted in the greatest expected flow of program payments. Decisions of farmland owners in South Dakota, in upland cotton area, and in the Heartland region support the payment-maximization argument. In general, landowners favored maximizing payments over aligning base acres to current or recent plantings. Farmland owners with high-payment base acres, such as rice and cotton, held on to these base acres and, whenever possible, expanded...

Tipo: Report

Palavras-chave: Base; 2002 Farm Act; Direct payments; Counter-cyclical payments; Production flexibility contract payments; Base acres; Program yields; Agricultural and Food Policy; Farm Management.

Ano: 2005

URL: http://purl.umn.edu/33594

Estimating the Costs of Revenue Deficiency Programs

This paper develops an approach to empirically demonstrate how the within-season distribution of U.S. domestic commodity support for corn differs between current-style approaches of support and revenue-based support. From a purely economic standpoint, the results show the revenue-based payment scenarios to be preferable at the national level to the uncoordinated forms of support currently in use, even in a situation where the annual mean payments are set equal across the support scenarios. For revenue-based support, the variability around the total expected annual payment is lower, and perhaps more importantly, the probability of high payments is lower. These results suggest advantages to this type of support, both in terms of lower budgetary uncertainty ...

Payments under the Average Crop Revenue Program: Implications for Government Costs and Producer Preferences

Palavras-chave: Domestic support; Marketing loan benefits; Counter-cyclical payments; Disaster assistance; Revenue support; Corn; Nonparametric; Semi-nonparametric; Bootstrap; Financial Economics.

Ano: 2007

URL: http://purl.umn.edu/9699

Risk Considerations in Supply Response: Implications for Counter-Cyclical Payments' Production Impact

This paper develops a stochastic model for comparing payments to U.S. corn producers under the U.S. Senate’s Average Crop Revenue Program (ACR) versus payments under the price-based marketing loan benefit and countercyclical payment programs. Using this model, the paper examines the sensitivity of the density function for payments to changes in expected price levels. We also assess the impact of the choice of yield aggregation used in the ACR payment rate on the mean and variance of farm returns. We find that ACR payments lower the producer’s coefficient of variation of total revenue more than does the price-based support, although ACR may not raise mean revenue as much. While corn farmers in the heartland states might still prefer to receive the...

Tipo: Journal Article

Palavras-chave: Domestic support; Counter-cyclical payments; Revenue; Price; Corn; Yield; Pairs bootstrap; Kernel density; Combinatorial optimization; Agricultural and Food Policy.

Ano: 2009

URL: http://purl.umn.edu/49864

Lin, William W.; Dismukes, Robert.

This study investigates the role of risk in farmers' acreage decisions in the Northcentral region by revisiting an earlier study by Chavas and Holt and tests the null hypothesis regadring the effects of wealth and draw out implications for farmers' risk attitudes. Estimated model results are used to examine counter-cyclical payments' production impact for major field crops.

THE 2002 FARM ACT: PROVISIONS AND IMPLICATIONS FOR COMMODITY MARKETS

Palavras-chave: Risk; Supply response; Marketing loan programs; Counter-cyclical payments; Northcentral region; Corn; Soybeans; Wheat; Risk and Uncertainty.

Ano: 2005

URL: http://purl.umn.edu/19304

Westcott, Paul C.; Young, C. Edwin; Price, J. Michael.

The Farm Security and Rural Investment Act of 2002 (2002 Farm Act), which governs agricultural programs through 2007, was signed into law in May 2002. This report presents an initial evaluation of the new legislation's effects on agricultural commodity markets, based on sectorwide model simulations under alternative policy assumptions. The analysis shows that loan rate changes under the marketing assistance loan program of the 2002 Farm Act initially result in an increase in total planted acreage of eight major program crops. This increase in plantings, however, is relatively small (less than 1 percent), partly due to the inelasticity of acreage response in the sector. In the longer run, the simulations indicate that overall plantings of the eight program...

Tipo: Report

Palavras-chave: Farm legislation; 2002 Farm Act; Agricultural programs; Commodity programs; Marketing loans; Counter-cyclical payments; Direct payments; Planting flexibility; Base acres; Payment yields; Farm income; Risk management; FAPSIM; Agricultural and Food Policy.

Ano: 2002

URL: http://purl.umn.edu/33745

U.S. Cotton Subsidies: Drawing a Fine Line on the Degree of Decoupling

Rossi, Frederick J.; Schmitz, Andrew; Schmitz, Troy G..

The impact of the U.S. cotton policy depends on several interrelated factors; how input subsidies interact with producer price supports, producer price expectations, and the extent to which price supports are decoupled from production. Cotton subsidies have a direct impact on world cotton prices, depending on the extent to which price supports are coupled to production. At one extreme, there is a price impact of 12.4% when producers make decisions at the loan rate, but the average price impact is 20.9% when producers make decisions based on the target price. Results are presented for intermediate cases of decoupling.

Tipo: Journal Article

Palavras-chave: Cotton; Counter-cyclical payments; Decoupling; Loan rate; Agricultural and Food Policy; Crop Production/Industries; Q17; Q18; Q25; Q28.

Ano: 2007

URL: http://purl.umn.edu/6621

VALUING COUNTER-CYCLICAL PAYMENTS: IMPLICATIONS FOR PRODUCER RISK MANAGEMENT AND PROGRAM ADMINISTRATION