Using Futures Prices to Forecast the Season-Average Price, Price Loss Coverage (PLC) Payment Rate and Counter-Cyclical Payment (CCP) Rate for Corn, Soybeans, and Wheat
Farmers and policymakers are interested in season-average forecasts of prices received by farmers for corn, soybeans, and wheat. These forecasts are also needed to compute Counter-Cyclical Payment (CCP) rates and Average Crop Revenue Election (ACRE) program payments under the 2008 Farm Act (to be discontinued for the 2014/15 marketing year), as well as Price Loss Coverage (PLC) payment rates and Agricultural Risk Coverage (ARC) payments to begin in 2014/15 under the 2014 Farm Act. For more information on the new PLC and ARC programs, see Agricultural Act of 2014: Highlights and Implications.
This data product provides three Excel spreadsheet models that use futures prices to forecast the U.S. season-average price received by farmers for corn, soybeans, and wheat. The models also compute the CCP payment rates for the 2013/14 marketing year and the PLC payment rates for the 2014/15 marketing year. The models do not compute ACRE program payments (for 2013/14) or ARC program payments (for 2014/15) because those calculations require state, county, or farm level data. Users can view the model forecasts or create their own forecast by inserting different values for futures prices, basis values, or marketing weights. A brief description of the forecast model components, procedures, and data is provided on the Documentation page.
For each of the three major U.S. field crops, the Excel spreadsheet model computes a forecast for:
- The national-level season-average price received by farmers.
- The implied price loss coverage (PLC) payment rate (2014/15) or counter-cyclical payment (CCP) rate (2013/14).
Note: the model forecasts are not official USDA forecasts. See USDA's World Agricultural Supply and Demand Estimates for official USDA season-average price forecasts. See USDA's Farm Service Agency information for official USDA CCP rates.