USDA Doubles SDRP Payments to 70%: Why Stage 1 Came in Hot and Stage 2 Came in Cold
The change in SDRP Stage 2 likely cost those producers at least $3 billion
On April 24, 2026, Agriculture Secretary Brooke Rollins stood in Higginsville, Missouri and announced that USDA was doubling the payment factor on the Supplemental Disaster Relief Program (SDRP) — from 35% to 70%. Producers with approved applications will receive an additional 35% of their calculated payment, and any future payments under the program will be issued at the new 70% rate. The application deadline for both Stage 1 and Stage 2 was simultaneously pushed from April 30 out to August 12, 2026.
For producers staring down spring planting financing, this is real money landing at a useful time. But the more interesting story underneath the announcement is why USDA had room to double the factor in the first place — and it has everything to do with how Stage 1 and Stage 2 demand has diverged from the agency’s original projections.
The setup: $16 billion split into two stages
The American Relief Act of 2025, signed in December 2024, allocated $30.78 billion in farm disaster authority. Of that, USDA carved out roughly $16.09 billion to fund SDRP — the program designed to backstop crop, tree, bush, and vine losses from 2023 and 2024 disasters that weren’t fully covered by federal crop insurance or the Noninsured Crop Disaster Assistance Program (NAP).
FSA structured the payouts in two stages:
Stage 1 uses pre-filled applications drawn from existing crop insurance and NAP indemnity records. Producers who already received an indemnity check got a streamlined supplemental payment on top.
Stage 2 is the harder, slower piece — covering shallow losses (losses too small to trigger insurance), uncovered/uninsured losses, and quality losses. Stage 2 sign-up didn’t open until November 24, 2025, and it requires producers to actively assemble and certify documentation rather than receiving a pre-filled form in the mail.
To stay inside the $16.09B box while applications were still rolling in, FSA applied a 35% payment factor to all gross calculated payments. The cost-benefit analysis published with the Stage 2 final rule projected initial outlays of roughly $9.87 billion at that 35% factor — the rest of the bucket would be available later for a top-up payment, if total demand came in below the cap.
What FSA originally projected vs. how it’s actually playing out
In its Stage 2 cost-benefit analysis, FSA estimated that Stage 1 would account for about 72% of total gross SDRP payments, with Stage 2 picking up the remaining ~28%. At the 35% factor, that pencils out to about $7.2 billion in initial Stage 1 outlays and $2.67 billion in initial Stage 2 outlays.
Two things stand out. First, Stage 1 has obviously come in materially higher than the original 35% estimate — mathematically, that’s by design once USDA doubled the factor. But the headroom to double the factor at all is the second, more interesting point: it exists because Stage 2 dollars have been slow to go out the door and look likely to come in below initial projections.
Why Stage 2 came in soft
Multiple sources covering the rollout point at the same set of friction points:
Late start. Stage 2 sign-up didn’t open until almost five months after Stage 1, leaving a much shorter window before the original April 30 deadline.
Manual application process. Stage 1 was pre-filled from existing RMA and NAP records. Stage 2 producers — particularly those with uninsured crops, value-loss operations, or quality losses — have to actively gather and certify documentation that USDA doesn’t already have on file.
Quality-loss and shallow-loss complexity. Practitioners report ongoing confusion at local FSA offices around documentation standards for quality-loss claims (rice farmers in the Mid-South sitting on unsold 2024 crop are a frequently cited example), as well as issues with replant acres and multi-county enterprise units.
Specialty crop coverage gaps. Over 43% of fruit/nut and 47% of vegetable/melon acreage is uninsured by either crop insurance or NAP, meaning Stage 2 is the only path for many specialty growers — and that path requires building a payment from USDA-assigned county yields and prices rather than from existing records.
The combination meant Stage 2 dollars piled up unspent while Stage 1 dollars flowed quickly. The deadline extension to August 12 is in part an attempt to give Stage 2 more runway to catch up.
Visualizing the shift
Here’s how the picture looks across original projection, what’s actually been paid, and where the doubled factor takes things:
SDRP Outlays: Original Estimate vs. Actual (April 2026), $ Billions
0 2 4 6 8 10 12 14 16
|------|------|------|------|------|------|------|------|
Original estimate
Stage 1 (35%) ████████████████████ 7.2
Stage 2 (35%) ███████ 2.67
Total initial ██████████████████████████ 9.87
Paid as of 4/24/26
Stage 1 (35%) ██████████████████ 6.7
Stage 2 (35%) ▏ ~0 (still processing)
After 70% top-up
Stage 1 (implied) ████████████████████████████████████ 13.4
Stage 2 (TBD) ▏ pending
Funding cap ███████████████████████████████████████████ 16.09
Stage 1 was originally projected to only consume about $11.6 billion of the $16.09 billion total. Instead, at a minimum it will consume at least $13.4 billion and likely will be higher. This will result in Stage 2 total payments at most being about $2.7 billion (likely lower), or about 16.8% of the total instead of the original projected 28%. This means that Stage 2 producers will see at least a $1.8 billion drop from the original 28% rate and it may be even lower.
We would like to show the amount of payments under Stage 2, but USDA has elected not to show a dashboard for Stage 2, only Stage 1. Some producers under Stage 1 will not get a full payment due to payment limits, but the average payout is about $14,000, therefore, this should not materially affect the projections.
Why the top-up came when it did
USDA Undersecretary Richard Fordyce noted in the Higginsville announcement that the agency had met with the American Bankers Association the prior week, where bankers raised the top-up issue specifically because of how SDRP money was flowing into spring operating loan decisions. With anhydrous ammonia prices reportedly above $1,100/ton which is up roughly 30% since late February and producers negotiating credit lines for the 2026 crop year, doubling the factor right now does better than holding the funds for a final true-up after April 30.
The structure of the doubling is straightforward: producers don’t need to refile anything. If you already have an approved Stage 1 application, you’ll receive an additional payment equal to your original SDRP payment (effectively a second 35% slug, taking the cumulative factor to 70%). All future SDRP payments — Stage 1 not yet processed, plus Stage 2 as those work through — will be calculated at the 70% factor from the outset.
What to watch from here
Stage 2 throughput between now and August 12. The deadline extension was explicitly framed around giving FSA county offices more time to handle Stage 2 application changes. If Stage 2 demand picks up materially, there’s still capacity within the $16.09B cap to absorb it at the 70% factor; if it stays soft, USDA could conceivably go higher than 70% in a final true-up.
The 90% statutory ceiling. SDRP payments are capped at 90% of the producer’s loss across all stages combined. That’s the actual ceiling on how high the factor can climb in a final top-up — not 100%.
The two-year coverage requirement. Anyone taking SDRP money has to maintain federal crop insurance or NAP coverage at 60% or higher for the next two eligible crop years on the same crop and county. Failure means repayment with interest. With payments now doubling, the dollar value of that compliance obligation just grew accordingly.
USDA’s $6.7B already paid through SDRP, layered on top of $9.3B through the Emergency Commodity Assistance Program and $1.9B through the Emergency Livestock Relief Program, brings total American Relief Act disaster disbursements past $17.9B. The 70% top-up isn’t new appropriations — it’s the predictable result of conservative initial factoring meeting weaker-than-expected Stage 2 throughput. For producers with approved Stage 1 applications, though, the practical effect is the same: the check that originally landed at 35% of calculated value is about to double (unless they hit a payment limit).