Government payments to farmers provide both variable and stable assistance
Farm program payments that are designed to protect farmers from price and revenue risk can fluctuate greatly from year to year. For example, marketing loan benefits and countercyclical payments go up during periods of low prices, such as 2005. Other payments are much more stable. Direct payments are based on historical production and yields for individual farms and do not fluctuate with prices. Aggregate conservation payments also tend to be stable because the long-term nature of Conservation Reserve Program (CRP) contracts. This chart is found in the ERS report, Changing Farm Structure and the Distribution of Farm Payments and Federal Crop Insurance, EIB-91, February 2012.
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