Agriculture Secretary Tom Vilsack today said that USDA will not issue final 2008 counter-cyclical payments to farmers enrolled in the Direct and Counter-cyclical Program for wheat, barley and oats because prices for these commodities have averaged well above levels that trigger counter-cyclical payments.

The 2008 Farm Bill requires 2008 final counter-cyclical payments to be paid as soon as practical following the end of the marketing year, but not sooner than Oct. 1, 2009.

Because the National Agricultural Statistics Service (NASS) published the final marketing year average prices for wheat, barley and oats on June 29, 2009, Secretary Vilsack can now tell producers that no final payments will be made for these commodities. The 2008 Farm Bill provides that one partial counter-cyclical payment may be issued after 180 days of the marketing year. However, USDA did not issue a partial payment for the 2008 crop of wheat, barley or oats because markets were strong. NASS is scheduled to announce the final market year average price for peanuts, the next commodity that may be eligible for final counter-cyclical payments, on Aug. 31, 2009.

The counter-cyclical payment rate is the amount by which the target price of each commodity, specified by the 2008 Farm Bill, exceeds its effective price. The effective price equals the direct payment rate plus the higher of either: (1) the national average market price received by producers during the marketing year, or (2) the national average loan rate for the commodity.

The final marketing year prices per bushel are $6.78 for wheat, $3.82 for barley and $3.15 for oats. There are no final counter-cyclical payment rates for wheat, barley and oats because their effective prices exceed target prices.
Foreach commodity, the counter-cyclical payment for each crop year equals 85 percent of the farm's base acreage, multiplied by the farm's counter-cyclical payment yield, multiplied by the counter-cyclical payment rate.

These final price announcements for wheat at $6.78, barley at $3.82 and oats at $3.15 also establish the 2009 Average Crop Revenue Election (ACRE) Program final guarantee prices based on the 2007 and 2008-crop market year average prices. These prices are needed to calculate potential ACRE payments for the 2009 crop year. The ACRE information page at provides both the 2007 and 2008-crop year market average prices and the 2009 market price forecast for eligible program crops.

Market prices since crop year 2006 for most ACRE-eligible commodities, except for upland cotton and peanuts, have been significantly above levels that would trigger counter-cyclical payments. For commodities with ACRE guarantee prices significantly above their respective target prices, ACRE payments provide a much higher level of income protection than counter-cyclical payments when market prices fall. Assuming that 2009 actual yields are the same as the benchmark yields, ACRE payments will trigger if market prices per bushel fall below 90 percent of the guarantee price. For 2009, the ACRE payment trigger levels per bushel are $5.97 for wheat, $3.68 for barley and $2.60 for oats. These levels compare to counter-cyclical trigger levels per bushel of $3.40 for wheat, $2.00 for barley, and $1.42 for oats.

For more information on ACRE and DCP, visit your local FSA county office or