Prices for hard red winter wheat have dropped far enough to trigger loan deficiency payments, or LDPs, across Nebraska.
Farm Service Agency state director Dan Steinkruger says it’s been nearly a decade since this safety net provision of the farm program has been triggered.
“It’s been quite a few years,” Steinkruger says. “In order to have LDPs, the price has to get below the loan rate and our prices have been significantly higher for some time. Unfortunately, we were at that point starting last week.”
Steinkruger says wheat LDPs are running just a few cents per bushel, but could appreciate as the harvest accelerates in Nebraska.
“We are in the middle of the wheat harvest and generally, we expect prices to trend down during harvest,” Steinkruger says. “It’s something that I think farmers need to be looking at as part of using the safety net and their marketing strategy.”
He says the key, especially for farmers who have contracted wheat, is they need to have physical control of their crop to be able to collect an LDP.
Wheat prices for 2015 also fell low enough to trigger a price loss coverage payment, or PLC, under the farm bill. Farmers will receive 61-cents per bushel, but won’t get those payments until October.
By Jerry Oster, WNAX, Yankton