When the market is more unpredictable than the crop, revenues in a recession can dry up quickly for farmers.
"Because a lot of our input costs have sky rocketed, fertilizer costs have gone up, fuel costs have gone up," said Roger Betz, of the Michigan State University Extension.
But a new program called ACRE, or Average Crop Revenue Election, as part of the 2008 Farm Bill will act as a subsidy for farmers based on the state's revenue as determined by national average price times the yield of corn, soy and other crops.
"If it falls below 90 percent of the previous two years average, then that triggers a potential payment for farmers," Betz said.
Payments that could bring in millions of for Michigan's agriculture industry says Roger Betz of the MSU Extension, and bring in hundreds of dollars for local farmers to help manage their risk.
"If we had just and average yield in Michigan, we're looking at a $60 to $70 payment per acre on your corn-based acres," Betz said.
So is the ACRE program for you? That's the question officials from the Farm Bureau and the MSU Extension will be answering in a series of meetings to educate farmers about the program.
"The meetings we have coming up are designed to educate farmers on what the benefits are of this program," Betz said.
While the payments wouldn't kick in until October of 2010, the deadline is August 14, 2009. Betz says while farmers do give up 20 percent of their direct payments, the small sacrifice will mean big help based on future projections.
"The odds are that it will pay and make up for the loss of revenue, even for the next four years, and this program is designed to help farmers manage their risk so, we have more of a steady flow of income from year to year," Betz said.
An informational meeting is being held Monday, July 27 at the Monsanto Research Farm at 474 S. Onondaga Road in Mason. You must apply for the ACRE program in person at your local Farm Service Agency by Aug. 14.