FSA is Using Higher of Projected or Harvest Price
Based on my application and other discussions, SDRP Stage 2 is using the higher of the two prices
There had been some concern that SDRP Stage 2 payments would be based solely on harvest prices when calculating the payments.
However, when reviewing my application from FSA and other discussions that we have had, it appears that the SDRP Liability listed in Box 22 is based on the higher of the projected or harvest price. This should be similar to Stage 1 and should result in the highest amount of payment to farmers.
To some degree it may not matter that much. Why is that. If it was based on a lower number that would lead to a lower initial payment under both Stage 1 and Stage 2, however, the top up payment to come later on would be a higher percentage.
Remember that there is only $16.1 billion allocated to SDRP, therefore, they will only pay that amount and the allocation based on harvest or projected price likely does not matter when the final disbursement is made.
But for now, it is based on the higher of the two numbers.