Archive for November, 2009

Do your homework; don’t be a tire-kicker

November 20, 2009

I have a neighbor who is a car salesman. If he has had a slow day, he gripes that nobody came in but a few tire-kickers. Although I’m sure almost everyone else knows what this term means, I didn’t, so I asked.

“A tire-kicker,” my neighbor explained, “is a person who isn’t really serious about buying anything. He is just passing time, browsing the car lot, if you will. But someone who is serious about making a big investment has done his homework, asks pointed questions and thoroughly checks out the different vehicles to see which one fits his wants, needs and pocketbook.”

OK. That makes sense.

I thought about this explanation when I read Dr. Michael Salassi’s article “Will ACRE Work For Rice” on page 14. According to the 2008 Farm Bill, producers have the option to continue with the standard counter-cyclical payment program or choose to go with the alternative Average Crop Revenue Election (ACRE) program as part of their farm program sign-up.

This is a very important decision for many reasons that Dr. Salassi so aptly outlines. For example, if you elect to sign up for the ACRE program, “all crops on the farm must stay in the ACRE program through the end of the Farm Bill cycle, through the 2012 crop year,” he explains. In other words, once you’re in, there’s no backing out.

Also, enrolling in the ACRE program means that the farm has to forego any counter-cyclical payments, agree to a 20 percent cut in direct payments and a 30 percent cut in the marketing assistance loan rate.

Because ACRE is new and more complicated that the counter-cyclical program, it’s in your best interest as a producer to find out as much as you can about this new option and learn how your farm would be affected should you choose to sign up for it. ACRE may be the right “vehicle” for your operation, or you may discover that you are better off sticking with the counter-cyclical program.

To help you make this decision, LSU AgCenter has developed a spreadsheet-based rice farm decision tool to help you evaluate rice farm program payment options. To access this tool, go to www.lsuagcenter.com, click on the “Rice” section, then click on “Publications.”

Remember, when it comes to choosing between the counter-cyclical program and ACRE, do your homework. Don’t be a tire-kicker.

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November 20, 2009

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