Updated Guidance on Price Forecast Models for the FarmDOC ARC/PLC Calculator

After I wrote my Guidance on Price Forecast Models for the FarmDOC ARC/PLC Calculator, FarmDOC staff updated the tool to allow users to choose “Custom” for their Forecast Model. As a result, users can enter any prices they want rather than having to interpolate or extrapolate to estimates of payments for prices not on the list. This short post is just to give guidance on prices when using this option.

The goal is to estimate payments for 2021, but the Custom option requires that you also enter prices for 2019 and 2020, as well as for 2022 and 2023.  To ensure that the program calculates your county benchmarks correctly based on actual outcomes, I recommend using the actual marketing year average prices for 2019 in the table below. For the same reason, I also recommend using accurate estimates for the 2020 marketing year. In this case, I recommend using the most recent USDA WASDE price estimates for the 2020 published monthly (https://www.usda.gov/oce/commodity/wasde). The table below has the estimates published on February 9, 2021. For 2021 and the years after, use whatever prices you want to estimate expected ARC and PLC payments for.

Recommended Prices to use for the Custom Forecast Model

Crop 2019 Price 2020 Price
Corn $3.56   $4.30
Soybeans $8.57 $11.15
Wheat $4.58   $5.00