Agricultural Commodities Price Enhancement Act

The Agricultural Commodities Price Enhancement Act is a new bill introduced in the House that would raise the reference prices used to determine price support payments under the 2014 Farm Bill’s Price Loss Coverage (PLC) program for five commodities: wheat, corn, soybeans, peanuts, and seed cotton. Specifically, it increases the reference prices as follows: wheat from $5.50 to $6.50 per bushel; corn from $3.70 to $4.20 per bushel; soybeans from $8.40 to $10.00 per bushel; peanuts from $535 to $635 per ton; and seed cotton from $0.367 to $0.45 per pound. The bill would apply only to these commodities and would take effect if enacted, potentially increasing the size of potential PLC payments when market prices are below these higher reference levels. In short, the bill updates the baseline price levels used to trigger certain farm subsidies, likely resulting in higher potential government payments to farmers for these crops when prices fall. It does not change other aspects of the PLC program or prices for other crops.