Farm safety net sees significant, encouraging updates in latest federal spending bill
“A stronger safety net will certainly help those who have been able to withstand the economic downturn so far. Many farmers have not been as fortunate to make it to this point.” — Hunter Biram
By Mary Hightower
U of Arkansas System Division of Agriculture
June 13, 2025
Fast facts
- Reference prices get average 15 percent increase
- Specialty crop farmers get stronger safety net
(618 words)
(Newsrooms: with art, illustration)
LITTLE ROCK — Agriculture is facing hard times.
Commodity prices have languished. Input prices have increased. Destructive weather has left few operations untouched.
In Arkansas, “there have been nearly 60 farm equipment auctions since December,” said Hunter Biram, extension economist for the University of Arkansas System Division of Agriculture. “That’s about 10 times more than what we would typically see in this time frame and that’s an indicator of just how serious the economic downturn is in Arkansas” agriculture.
Biram, who co-authored a report on net farm income in Arkansas, noted that it was only federal aid that halted a two-year slide. Net farm income was expected to continue its downward trajectory in 2026.
Glimmer of hope
However, the latest House and Senate versions of a federal spending bill now headed to reconciliation, offers some glimmer of hope, keeping farm safety nets largely intact, with some notable changes, he said.
“The Senate's version of the reconciliation package is almost exactly like the House version in terms of the farm safety net, which I find to be pretty encouraging,” Biram said.
There are a variety of safety nets in farming including ARC, or Agriculture Risk Coverage, and PLC, or Price Loss Coverage. These programs are administered by the Farm Service Agency, part of the U.S. Department of Agriculture.
The ARC program provides payments when the county revenue for a farm is less than a guarantee set based on historical data and market conditions. The PLC program provides payments when the realized price for a covered commodity falls below its effective reference price, or target price.
In the face of chronically low commodity prices, farmers urged Congress to raise to reference prices. In the most recent report on net farm income for Arkansas, corn receipts dropped 48 percent since 2022; cotton declined 11 percent since 2023 and rice has fallen 8 percent since 2024. Soybean receipts are down 31 percent since 2022.
“A stronger safety net will certainly help those who have been able to withstand the economic downturn so far. Many farmers have not been as fortunate to make it to this point.” Biram said.
“On average, it's looking like there's a 15 percent increase in the PLC statutory reference prices across all of the crops,” Biram said.
The Agricultural Risk Coverage county guarantee was increased from 86 percent to 90 percent, and the maximum payment rate was increased from 10 percent of expected county revenue to 12.5 percent,” he said.
Biram also noted increases in premium subsidies in crop insurance. The supplemental coverage option premium subsidy rate would increase from 65 percent to 80 percent and other major multi-peril crop insurance products would see anywhere from a 3 to 5 percentage point increase. Additionally, the maximum coverage levels for the supplemental coverage option would increase from 86 percent to 90 percent.
Benefits for specialty, beginning farmers
If the spending bill is passed and signed into law, there will be other benefits for farmers.
Specialty crop growers — those who grow fruits and vegetables — had also urged Congress for stronger protections.
“The whole farm revenue protection program, which will be the primary crop insurance product that specialty crop producers would use, got an increase in its maximum coverage level from 85 percent to 90 percent,” Biram said.
Beginning farmers will also get a break. Currently the insurance program for beginning farmers that provide a premium subsidy and exemption from some fees, only applies for farmers in their first five years.
“Eligibility for beginning farmer status has now increased from 5 years to 10 years,” Biram said. “This allows beginning farmers to hold status for 5 additional years providing them with assistance that can help them as they establish the farm operation.”
To learn about extension programs in Arkansas, contact your local Cooperative Extension Service agent or visit www.uaex.uada.edu. Follow us on X and Instagram at @AR_Extension. To learn more about Division of Agriculture research, visit the Arkansas Agricultural Experiment Station website: https://aaes.uada.edu/. Follow on X at @ArkAgResearch. To learn more about the Division of Agriculture, visit https://uada.edu/. Follow us on X at @AgInArk.
About the Division of Agriculture
The University of Arkansas System Division of Agriculture’s mission is to strengthen agriculture, communities, and families by connecting trusted research to the adoption of best practices. Through the Agricultural Experiment Station and the Cooperative Extension Service, the Division of Agriculture conducts research and extension work within the nation’s historic land grant education system.
The Division of Agriculture is one of 20 entities within the University of Arkansas System. It has offices in all 75 counties in Arkansas and faculty on three campuses.
Pursuant to 7 CFR § 15.3, the University of Arkansas System Division of Agriculture offers all its Extension and Research programs and services (including employment) without regard to race, color, sex, national origin, religion, age, disability, marital or veteran status, genetic information, sexual preference, pregnancy or any other legally protected status, and is an equal opportunity institution.
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Media contact: Mary Hightower
mhightower@uada.edu