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Conner: No penalty-free early CRP contract releases

Agriculture.com Staff 09/28/2007 @ 3:33pm

Acting Secretary of Agriculture Chuck Conner announced late Friday afternoon that his agency will not be offering penalty-free early releases from Conservation Reserve Program (CRP) contracts in the immediate future.

The USDA head cited numbers in Friday morning's USDA Crop Stocks report, as well as current corn production estimates and world wheat demand for the CRP decision.

"While this year's global wheat market remains very tight, corn production is expected to be record-high, and today's grain stocks report indicated higher than expected stocks for corn and soybeans at the start of the 2007/08 crop year," Conner said Friday. "In addition, more than 2 million CRP acres expire under existing contracts this weekend, on September 30, 2007."


Conner continued, saying the current marketplace doesn't justify farmers opting out of CRP contracts right now anyway, in terms of both crop stocks and market prices. Farmers have increased acres and adjusted production practices enough already, he said, to meet the market's demand despite the fact it continues to grow.

"Wheat, soybean and corn markets are providing very strong incentives to plant more acreage this fall and next spring. Throughout this year, the market focused on attracting corn acres, and to a lesser extent, wheat acres," Conner said. "Producers responded strongly, with corn acres increasing to their highest level since 1944. Wheat market prices are indicating an expected significant increase in planted area this fall and next spring in the U.S. and around the world.

"The potential exists for increased double-cropping and the planting of fallow ground. Overall, I expect that market signals will continue to provide adequate acres, recognizing that strong competition among crops is likely."

Looking into the future, Conner said he'll continue to "closely monitor" how farmers respond to current marketplace signals, acreage-wise, and "make adjustments to USDA programs if needed." But, future adjustments will continue to depend on grain supplies and corresponding market moves.

"I would not anticipate offering a general signup while grain stock levels remain historically low and prices continue at unprecedented levels," Conner said Friday. "Acres under continuous CRP signup, such as filter strips and riparian buffers, are not affected by general signup decisions. Enrollment of acres that qualify for continuous signup is ongoing."

Acting Secretary of Agriculture Chuck Conner announced late Friday afternoon that his agency will not be offering penalty-free early releases from Conservation Reserve Program (CRP) contracts in the immediate future.

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