Base Acre Policy Raises Equity, Market Distortion Questions

Decoupled base acres may amplify income inequality and distort planting decisions as farm program payments increase.

URBANA, Ill. (RFD NEWS) — Federal farm payment policy may be increasingly misaligned with today’s production realities, raising equity concerns and potential market distortions as new base acres are allocated in 2026.

Jonathan Coppess, with the University of Illinois Department of Agricultural and Consumer Economics and former Administrator of the U.S. Department of Agriculture (USDA) Farm Service Agency, says the USDA’s continued reliance on decoupled base acres rewards historical planting decisions rather than current risk exposure.

In a January 15 farmdoc daily analysis, Coppess explains that ARC and PLC payments are tied to base acres, not planted acres, allowing farmers to receive payments for crops they do not grow. With USDA signaling it will prioritize assigning new base acres to formerly unassigned cotton acres, those design flaws are returning to the forefront as program signups are delayed.

Using national average data, Coppess shows that crops with high base-acre payment rates — particularly rice, peanuts, and seed cotton — generate significantly higher total returns when corn or soybeans are planted on those base acres. Two producers growing the same crop can receive vastly different income outcomes solely because of their base-acre history.

Those disparities may influence planting decisions, especially as higher ARC and PLC payments take effect under the Reconciliation Farm Bill. Coppess cautions that this could contribute to oversupply risks in corn and soybeans.

Farm-Level Takeaway: Decoupled base acres may amplify income inequality and distort planting decisions as farm program payments increase.
Tony St. James, RFD NEWS Markets Specialist
Related Stories
RFD-TV Farm Legal and Tax Expert Roger McEowen explains the basics of Low-Risk Credit in Farming, and how an understanding of the farm credit landscape lets producers tactfully approach debt.
American soybean and corn leaders, along with Canada’s AgriFood sector, testified before the U.S. Trade Representative’s Office in support of the trade pact between the U.S., Mexico, and Canada.
Texas livestock producers face a heightened biosecurity threat as New World screwworm detections in northern Mexico coincide with FDA approval of the first topical treatment.
“The Expanding Access to Risk Protection (EARP) Final Rule streamlines requirements across multiple crops, responds to producer feedback, and strengthens USDA’s commitment to putting America’s farmers first,” said the USDA.
Rep. Michelle Fischbach shares her appreciation for rural communities and outlines how the Working Families Tax Cut is aimed to support farm families on RFD-TV’s Champions of Rural America.

Tony St. James joined the RFD-TV talent team in August 2024, bringing a wealth of experience and a fresh perspective to RFD-TV and Rural Radio Channel 147 Sirius XM. In addition to his role as Market Specialist (collaborating with Scott “The Cow Guy” Shellady to provide radio and TV audiences with the latest updates on ag commodity markets), he hosts “Rural America Live” and serves as talent for trade shows.

LATEST STORIES BY THIS AUTHOR:

Imported lean beef continues to play a critical role in U.S. hamburger and ground-beef production, with any added volume from Argentina serving as a supplement — not a market overhaul.
A fast-moving series of trade signals from the White House and key partners is resetting the near-term outlook for U.S. agriculture.
Stay alert for trade announcements—especially border reopening timelines, tariff threats, and developments in Brazil’s export flows.
Margin Protection and the new MCO add county-level margin tools — with earlier price discovery, input cost triggers, and high subsidy rates — to complement on-farm risk plans for 2026.
For aging operators and their rural neighbors, staying socially engaged is a practical strategy to preserve decision-making capacity and farm vitality.
Until a phased reopening is inked, plan for tighter feeder availability, firmer basis near border yards, and continued reliance on domestic and Canadian sources.