Evaluating the Historical Variability of Corn’s Market Year Average Price and Projecting Price Loss Coverage Payments
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چکیده
Market Year Average (MYA) prices enter into payment calculations for Price Loss Coverage (PLC) and Agricultural Risk Coverage (ARC), two commodity program alternatives available in the 2013 Farm Bill (see here for more details). The distribution of MYA prices will influence payment levels under both programs. Hence, quantifying the potential MYA price distributions is important for evaluating choices between commodity programs. Moreover, quantifying MYA price distribution aids in understanding price risk farmers face. Herein, the distribution of MYA corn prices is quantified based on historical price variability. Based on this distribution, PLC payment rates are estimated.
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