1. Farm Bill: Domestic Policy Outlook
Joe L. Outlaw
Regents Fellow
Professor & Extension Economist
Co-Director, AFPC
2018 Southern Outlook Conference
Atlanta, GA
September 24, 2018

2. Presentation Outline A Few Observations About the Current Farm Bill
MFP
Seed Cotton Outlook
FAPRI Net Income Update
Conclusions
Farm Bill

3. A Few Observations About The Current Farm Bill
Baseline Farm Bills are no Fun – for anybody
Getting Seed Cotton in the Bipartisan Budget Act was Way Bigger Than Leadership Gets Credit For
Can’t imagine trying to get cotton back in Title I in the current D.C. climate
Instead of spending cuts across commodities at least we are flat to flat +
We All Need to Let the Process Play Out Before Declaring a Certain Commodity Isn’t Getting Anything
There are still some beneficial provisions in play
Think about yield exclusion in the 2014 FB …. Didn’t score much…. Not much talk in the press but… HUGE in terms of a producer’s safety net

4. Sometimes Doing the Right Thing is Hard
Source: Jim Wiesemeyer

5. Key Seed Cotton Takeaways
You will have to:
Allocate generic base acres to cotton or other crops
Evaluate your opportunity to update your seed cotton payment yield
Choose between ARC or PLC for safety net coverage
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6. 3 Situations Producers Are In
Decision Focuses on the 2009 to 2012 Plantings
Your Average Plantings were either:
Greater than or equal to generic base acres
Option 1 will give you all your generic acres in seed cotton
Option 2 depends on the overall base on the farm
Less than but close to generic base acres
Option 1 will give you at least 80% of generic and maybe more but not 100%
Option 2 will allow you to have quite a bit of seed cotton but add to other bases
Very small relative to generic base acres
Option 1 will provide up to 80% of generic in seed cotton
Option 2 will largely reallocate generic to other crops

7. What Option 2 Won’t Allow You to Do?
Can’t just put all your bases in the crops you want – determined by the percentage of acres planted to covered crops from
Can’t end up with more base on farm than you started with
Where we are – cotton projected payments are higher than almost all other crops so… does a producer take fewer base acres to get higher potential payments?

11. Conclusions
I am not going to say that all farmers are broke and we are headed for a 1980s type crash
What I think is true is that for the 300,000 to 400,000 real farmers in the U.S., the likelihood of failure is equal to the likelihood of staying in business – some just don’t realize it
Across the country the record yields experienced over the last few years temporarily changed the outlook and put off a disaster—for now
Getting a farm bill can help but more about lenders than producers

13. Thanks!!!
Joe Outlaw