What a difference a year makes. Last year at this time some areas were cleaning up from an early snowstorm that dumped over 20 inches on us. Harvest had also just started, and the fight continued through May 2020 to get all the corn harvested. Fast forward to this year where we are wrapping up harvest. However, we did get a little of the white stuff just to make things look pretty.
Although harvest for most has gone smooth, we all know the other obstacles 2020 has thrown at us. As a result of the turbulent times this year, we have also seen many new government programs thrown at us. Some of these new programs, along with existing ones, are starting to near important deadlines.
We saw the Coronavirus Food Assistance Program (CFAP) emerge as a fast way to get funds out and help producers of agricultural commodities absorb loss of sales and increased marketing costs associated with the COVID-19 pandemic. The deadline for CFAP 1.0 was September 11th, 2020. On September 21st, 2020, the Farm Service Agency started accepting CFAP 2.0 applications. CFAP 1.0 has approved over 645,000 applications and paid out over $10 billion nationwide. As of October 13th, CFAP 2.0 has approved over 242,000 applications and paid $4.5 billion to producers nationwide. The deadline for CFAP 2.0 is December 11th, 2020.
Although I don’t have the specific numbers for the Wildfire and Hurricane Indemnity Program Plus (WHIP+), I know many producers have received payments over the last 12 months. Initially, producers were paid 50% with up to an additional 50% paid based on funding availability. They have now published an October 30th deadline for application. The hope is that once we get passed the new deadline, they will be able to decide on the remaining 50%.
This month we have also seen FSA make payments for 2019 ARC/PLC. Decisions for 2019 & 2020 were made last winter, but FSA has now opened up enrollment for the 2021 crop year. You have until March 15th, 2021 to finalize your decisions, but it never hurts to start your research. I promise you here at AgCountry we will be monitoring the prices and yields to help you make the best educated decision you can.
With the rally in the market and good harvesting conditions, we have also been seeing more crop sold off the combine. Basis in most of our area has remained low and allowed for the producers to capture these rallies. With all these decisions and application deadlines also comes some payments. Something to keep in mind as we put away the equipment for the year is tax planning. With some of this unexpected revenue in 2020, it is very important to talk to your tax professional and plan. Like a marketing plan, tax plans help mitigate our tax risk as well.
This year is one for the record books. I’m not sure I could list all that has happened, but we need to be prepared for what’s next. The best way to do that is to make a plan and be flexible as conditions change. We know the deadlines that are around the bend. Now let’s do our best to be ready.
Stay healthy and safe!