The proposed Farmer Assistance and Revenue Mitigation (FARM) Act of 2024 was estimated to cover $21.7 billion, or 61%, of $35.9 billion in economic losses across eight crops. But the proposed coverage was far from even: estimates ranged from 0% for barley to 87% for rice. In a November 13, 2024 analysis, farmdoc daily authors Carl Zulauf, Gary Schnitkey, Jonathan Coppess, and Nick Paulson argue that evaluating the proposal requires more than looking at its total. The key questions are who bears the losses, how aid is distributed across crops, and how existing farm programs factor into the calculation.
These figures describe estimates of a proposal using information available in November 2024. They are not realized payment totals and do not establish whether the proposal became law.
What the FARM proposal was estimated to cover
The authors estimated 2024 economic losses of $35.9 billion across barley, corn, oats, rice, seed cotton, sorghum, soybeans, and wheat. Estimated FARM payments of $21.7 billion would cover 61% of those losses in aggregate, leaving an estimated 39% for farmers to bear.
That aggregate figure masks substantial differences by crop:
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| Crop | Estimated share of economic loss covered |
|---|---|
| Rice | 87% |
| Corn | 82% |
| Soybeans | 80% |
| Seed cotton | 51% |
| Wheat | 35% |
| Barley | 0% |
| Oats and sorghum | Within the reported 35%–51% range for the other crops; individual percentages not stated in the summary of estimates. |
The large spread raises a fairness question. Many farms produce more than one crop, while the proposal’s rationale addressed broad market revenue and price pressure alongside high production costs. A farm’s mix of crops could therefore affect how closely its estimated aid matched its losses.
What “economic loss” includes
The estimate is not limited to cash expenses paid during the season. The authors’ economic-cost calculation includes charges for inputs other than management, plus opportunity-cost returns for unpaid labor and owned land. They say the input measures are determined by USDA’s Economic Research Service.
Including these costs matters when interpreting the loss figures: the measure attempts to account for resources a farm supplies itself, not only bills it pays to outside vendors. The 61% coverage estimate is a share of that broader economic-loss measure.
Who should bear the remaining losses?
The authors frame the burden-sharing issue as: “What share of the systemic risk downturn should farmers bear?” Under the proposal, farmers would bear an estimated 39% of losses. The authors compare that share with farmers’ 38% contribution to crop-insurance premiums for the crops studied.
They question whether a 39% farmer share is too small in light of recent high market returns and previous ad hoc assistance. That is a policy judgment, not a result implied by the arithmetic: choosing a share requires deciding how much systemic risk should be absorbed by producers versus public support.
Should loss coverage be more consistent across crops?
The authors ask whether coverage of economic loss should be the same or vary by crop. The estimated 0%–87% range makes this a consequential design choice rather than a minor difference in allocation.
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They identify a possible route to more uniform coverage: use current 2024 yield estimates rather than the proposal’s 2014–2023 ten-year average. The authors present this as a simple way to make coverage rates more uniform if uniformity is the policy goal; it is not evidence that the proposal used that alternative or that all crops would receive identical treatment under it.
How existing programs complicate the calculation
Crop-insurance and commodity-program payments can reduce the losses that remain for farmers, so deciding whether and how to count them affects the amount of additional assistance. The authors’ third design question is whether payments from existing safety-net programs should be counted toward economic assistance by crop.
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- Crop insurance: Payments are attributable to a particular crop, making crop-level comparison more direct.
- ARC and PLC: Commodity payments are based on historical base acres, not necessarily the crops planted in the current year. Allocating those payments among crops grown in 2024 is therefore difficult.
The authors warn that ignoring existing payments risks excessive public assistance. Yet assigning base-acre payments to current production is not straightforward, so any method of counting them entails a design choice.
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Why payment timing matters
When the authors published their analysis on November 13, 2024, ARC and PLC payments for the 2024 crop were not expected to be known until October 2025. That delay meant policymakers considering assistance before then could lack a key input for estimating producers’ remaining losses and risk compensating them incorrectly.
The authors favor moving commodity-program payments forward from the end of the marketing year. Their suggested approach uses futures prices so payments could be made around harvest rather than the following year. They argue that policymakers should address this timing gap first, then decide whether further ad hoc assistance is appropriate.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Prevent-plant payments and the role of crop insurance
The analysis estimates $1.1 billion in net prevent-plant crop-insurance payments for the eight crops, compared with $0.2 billion in estimated FARM prevent-plant payments. These are publication-era estimates, not current payment totals.
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The authors also ask whether FARM should make prevent-plant payments. As with other crop-insurance payments, prevent-plant payments are tied to a particular crop. That differs from ARC and PLC, whose payments are based on historical base acres, reinforcing the difficulty of comparing all forms of support on a crop-by-crop basis.
A practical framework for judging the proposal
For readers comparing FARM with another assistance design, the authors’ analysis points to three useful tests:
- Burden-sharing: What proportion of losses would farmers bear, and what proportion would public assistance cover?
- Distribution: How consistent would coverage be across crops and regions, and what explains any differences?
- Coordination and timing: How would crop-insurance and commodity-program payments be incorporated, and would they be known in time to calculate remaining losses?
The proposal’s 61% aggregate coverage answers only the first question in part. The crop-level variation and delayed information about commodity-program payments show why the total alone cannot establish whether the assistance is equitable or appropriately sized.
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