PLC or STAX for 2023 Cotton
A lot of our yearly planning uses the winter prices, our recent yield histories, and a projection of upcoming expenses. This year should lead us to a similar conclusion as 2022 did with peanuts and cotton providing the most farm revenues, only not quite as good at this point in time.
So sure, if we have a good season and the prices bla, bla, bla, then we should be fine. And we have had a good run of success, so I’m quite hopeful.
But just on the chance that things go sideways, we will spend several weeks exploring safety nets so we don’t get hurt. Cotton will lead the way again for defense as usual. These current price levels keep us out of any payments for PLC or ARC, including peanuts. That leaves STAX evaluation. It’s too early for the actual math as we are in the discovery period for insurance prices, but at current levels, STAX will again kick in long before PLC does. Plus STAX will allow 100% coverage of cotton regardless of base; whereas even if you have high base, the PLC is only 85% of base acres. ON top of that, STAX provides safety net protection for price and yield.
While we are still too early to make a final decision, if things continue as they started, we should have our risk covered better with STAX.
The deadline for the decision in NC is the end of February.
The deadline for VA is March 15th.
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