Crops Insights

Decades in, hundreds of thousands of farmers value FSA’s Conservation Reserve Program

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The deer flies dance across darkening grasses, and daisies dot the acreage. Suburbanites driving down the rural highway offer puzzled looks at the hill of overgrown weeds, neither pasture nor field. It stands in stark contrast to the neatly rowed fields of soybeans just down the road. But the deer flies and the honeybees and the bobwhites all know different, and as the landowner receives another year of rent payments, he too knows that conservation practices can return dividends on many levels.

Whether you own 50 acres or 5,000, the Farm Service Agency’s Conservation Reserve Program has a bounty of benefits in which you might be interested. Thirty years old this year, the federal government has spent three decades pruning and nurturing the program into what many consider the most productive initiative in history. With benefits ranging from cash payments to improved ecology and wildlife habitats, the 652,305 contracts signed this year represent a diversity of participants, interests and goals, as broad as the U.S. population itself. As the 49th general signup commenced in May 2016, the program is believed to possess tremendous opportunity going forward. Across the country, agencies ranging from soil and water conservation districts to farm bureaus have celebrations underway and literature available commemorating not only the program’s storied past, but its bright future.

Donald Donovan, district conservationist for Parke and Clay counties in west-central Indiana, had CRP participants in his office in mid-July, working out the details of their specific properties’ involvement. With roots actually dating back to the U.S. Agriculture Act of 1956 as part of what was then called the Soil Bank Program, today the multifaceted offerings extend into many arenas of conservation, from timber to pollination zones.

“I’m one of the few people that’s been around since it started,” Donovan said, noting his service in the field spans more than three decades. The program has changed a bit over the years, particularly in terms of the opportunities offered, but overall the positive attitude toward it remains, he said. “I think it’s been as successful a program as the government has had in terms of conservation.”

In 1986, the CRP was born by way of the 1985 Farm Bill under President Ronald Reagan. The program offers financial incentives to landowners who agree to set aside ground for specific periods of time and purposes. That year, 1,929,064 acres were enrolled into the launch at an average of $42.99 per acre. Three decades later, the May 2016 enrollment saw 23.89 million acres of land by way of 652,305 contracts on 365,771 farms. The 2014 U.S. average for rent-per-acre was $63.66. The number of acres has changed dramatically in dynamic fashion over the years, due to fluctuating crop prices as well as congressional caps on participation. In 2007, enrollment in the CRP peaked at 36.8 million acres. And whereas in 2013, the USDA accepted nearly 90 percent of the acres offered under general signups, in 2016, that acceptance rate was only 23 percent, making for a more selective program.

“I think it’s been as successful a program as the government has had in terms of conservation.”

Most people associate the CRP with programs that offer direct financial payments to farmers who agree to take fields out of row-crop production. Donovan said farmers’ desire to do so is directly impacted by crop prices. Taking tillable land out of production is less enticing when corn prices are over $7 a bushel, but more attractive if they’re under $4. Most CRP contracts are for 10 to 15 years, making for a bit of a gamble, but overall one in which farmers have been quite interested, he said. But when crop prices have spiked in years past, it hasn’t been uncommon to hear farmers wanting to withdraw from the voluntary program then desire a return when the prices drop. The ability to withdraw from the program has varied over the years, with periodic windows such as in 2015 when participation rates were determined to be high enough. Otherwise, a number of options are available for landowners who either decide to either sell or bequeath the land midway through a CRP contract. Depending on a number of variables — including number of years enrolled and purpose — penalties could be nonexistent or could require a complete return of the monies paid during the life of the program. Individuals considering the program should consult with their local Farm Service Agency about their options. Likewise, Donovan said the price-per-acre offered varies by program, soil type and productivity and specific rent payments can vary widely.

According to current projection estimates for cultivating no-till corn post-soybeans, the average cost of producing a bushel of corn in 2016 will be $3.98 per bushel. Per the May 2016 World Agricultural Supply and Demand Estimates report by the USDA, the mid-point corn price projected for 2016/2017 was $3.35 per bushel, meaning a farmer averaging 180 bushels per acre for corn could lose $113 for every acre planted. By July, the prognosis hadn’t much changed. In years like this, farmers become interested in taking cash for empty land rather than a loss. Some of the tillable ground in rural Indiana nets between $200 and $260 per acre in the CRP, which can seem pretty attractive to a small landowner trying to decide between cash renting the ground or setting it aside. The program has become especially popular for smaller owners with properties larger row-croppers don’t want to try handling with newer equipment, he said.

In the early years of the CRP, Donovan recalled most participants were focused on setting aside entire fields. Today, he said, the emphasis has shifted to waterways, strips of land and individual zones set aside to help wildlife such as birds and bees. Conservationists can help landowners assess their property for potential participation. In just 30 years, the program has evolved into a multifaceted offering including the Bottomland Hardwoods Initiative, the Duck Habitat Initiative, the Floodplain Wetland Initiative, the Highly Erodible Land Initiative, the Honeybee Habitat Initiative, the Longleaf Pine Initiative, the non-floodplain and Playa Lakes Wetland Initiative, the Pollinator Habitat Initiative, the State Acres for Wildlife Enhancement (SAFE) Initiative, the Upland Bird Habitat Initiative. Donavan said the honeybee and pollinator habit zone programs are particularly popular in rural Indiana at present as they allow landowners to better utilize smaller, non-productive areas in a meaningful way.

According to the USDA, in its 30-year lifespan, the CRP has helped prevent more than nine billion tons of soil erosion, the equivalent of some 600 million dump trucks. Each year, the CRP has helped reduce nitrogen runoff on tilled cropland by 95 percent and phosphorus runoff by 85 percent. The program has created nearly 2.7 million acres of restored wetland and is credited with reducing greenhouse gasses by 49 million tons per year, the equivalent of nine million cars’ output.

With growing interest in conservation practices and reduced greenhouse gasses, the CRP looks to be an important player for many years going forward, and represents an opportunity to simultaneously improve revenue while helping the environment.

 

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