New Farm Bill Benefits Include Higher Reference Prices for PLC & ARC Programs
Implementation of the Bill’s Provisions Delayed While Rules Are Written
When a major piece of legislation is enacted at the federal level, the implementation of it is not yet a done deal. It takes weeks and sometimes months for federal agencies to write new regulations that translate the bill’s intent into the rules that will guide day-to-day implementation.
Such is the case with the new Farm Bill, which was rolled into the so-called One Big Beautiful Bill (OBBB) recently signed into law. The bill makes sweeping changes to U.S. tax laws and social programs, as well as reauthorizing the Farm Bill, which had been delayed for more than two years.
Consequently, local and regional Farm Services Agency (FSA) managers are waiting for guidance from the USDA regarding the rules for implementing the many provisions of the new Farm Bill.
We will keep you informed along the way about the new rules as they are implemented, but for now, we’ll focus on changes in the 2025 Farm Bill that affect the Price Loss Coverage (PLC) and Agriculture Risk Coverage (ARC) programs, the two cornerstone federal programs that support farmers by compensating them when the effective price for a covered commodity falls below specified reference prices.
Changes to the PLC and ARC Programs
The PLC and ARC programs protect farmers from two of their biggest economic threats — market downturns that depress crop prices (PLC) and weather disasters that damage or destroy crops (ARC).
To participate in these programs, farmers must choose one or the other each year, meaning you can’t benefit from both programs in the same year. This requires some educated prognostication on the part of the farmer. Will the economy whack me this year, or the weather? Or will it be a great year all around?
Because the 2025 Farm Bill was enacted so late in the year — it was signed into law on July 4, 2025 — it specifies that farmers need not make the choice between the PLC and ARC programs this year. The USDA will make the choice based on a calculation of which program will yield the highest payments for each participating farmer. This is a recognition that the PLC and ARC programs have changed substantially at a time when farmers already signed up for one program or the other based on their anticipation of this year’s crop performance and — most importantly — the reference prices that were in effect at the time.
While many specifics about the implementation of the new PLC and ARC rules are unknown, what is known is that the reference prices on which the program benefits are based have been raised. For example, the reference prices on corn, sorghum, soybeans and wheat will rise as follows:
Crop Old Reference Price New Reference Price
Corn $4.26 $4.42
Grain sorghum $4.51 $4.67
Soybeans $9.66 $10.71
Wheat $5.56 $6.35
For a detailed list of price changes per crop, see the chart below.
In addition to the higher reference prices, the new Farm Bill raises the PLC and ARC payment limits per farmer to $155,000 per year, from $125,000.
Questions?
While it’s clear that most farmers will benefit from the 2025 Farm Bill, full implementation of the legislation’s provisions will take a while as the USDA writes the rules and regulations that will guide the day-to-day workings of the many federal programs that are governed by the legislation.
We will keep you informed as information becomes available about the PLC and ARC programs, as well as other Farm Bill programs.
In the meantime, if you have questions about how you will be impacted by the new Farm Bill, contact an Adams Brown agriculture advisor.
