We Update Our FBA Payment Estimates

University of Illinois releases their estimates and we provide additional calculations

Photo by Jed Owen on Unsplash

The University of Illinois in their FarmDoc Daily release today provides their estimate of Farmer Bridge Assistance payments.

Unlike our original estimates, they have more details on the production expenses that we did not use originally.

However, the ECAP payments were based on the higher of two numbers as follows:

• 26% of the net loss for each crop, or

• 8% multiplied by the current reference price multiplied by the current national PLC yield.

FarmDoc Daily estimates appear to only use the first calculation in arriving at their FBA payments as follows:

• Corn - $46

• Soybeans - $25

• Wheat - $39

• Cotton - $115

• Oats - $92

• Rice - $134

• Peanuts - $64

• Sorghum - $48

• Barley - $21

Now that we have the estimated net loss by these crops, we can estimate payments based on the ECAP calculations using the greater of 26% of estimated loss or the PLC factor as follows (this assumes the statutory reference price, not the effective reference price):