As of the writing of this column, USDA was still reviewing the possibility of offering an “early-out” option for existing Conservation Reserve Program (CRP) contract acres for the 2009 crop year, in response to the current very tight grain supplies and the need for more acres of crop production in future years. USDA is likely to make a decision on releasing existing CRP acres very soon, in order to allow adequate time for producers to plan for the 2009 growing season. Eligibility of CRP acres for the “early-out” option will likely be determined by the environmental benefits index (EBI) assigned to each CRP contract. The other big question will be how many landowners will opt for an “early-out” option on eligible CRP acres, if that opportunity becomes available in the coming weeks. A big factor may be if the crop acres are eligible for all commodity farm programs under the new Farm Bill, and if all crop base acres and program yields are re-established. Following is the listing of expiring CRP acres on September 30 each year for the next five years:
> 2008 ----- 1.2 million acres
> 2009 ----- 3.9 million acres
> 2010 ----- 4.5 million acres
> 2011 ----- 4.4 million acres
> 2012 ----- 5.6 million acres
As of April 30, 2008, there was a total of 34.7 million acres enrolled in the CRP program, which is down from 36.8 million acres on September 30, 2007. CRP contracts expired on approximately 2.6 million acres on September 30, 2007; however, an additional 515,000 acres have been added to the CRP program since that time through Continuous CRP enrollment and CREP enrollments. Currently there are approximately 30.6 million acres under General CRP contracts, 2.9 million acres under Continuous CRP contracts, and 1.1 million acres under CREP contracts. There has not been a General CRP sign-up in the past couple of years, and no General CRP sign-up is planned in the immediate future. Sign-up for Continuous CRP is on-going, and will continue to be on-going under the New Farm Bill, which was just approved by Congress. Continuous CRP targets the most sensitive environmental land areas, such as filter strips, buffers, wetlands, etc. The CREP Program is a CRP partnership with State Conservation Programs, which target specific watersheds.
CRP contract holders with CRP contracts that expired in 2007, 2008, 2009, and 2010 were given the opportunity to extend their expiring CRP contracts for an additional 5-10 years. CRP contracts are normally 10 or 15-year contracts. 87% of the eligible acres that were set to expire on September 30, 2007, or 13.5 million acres, were re-enrolled back into the CRP program. For 2008-2010, 9.5 million CRP acres, or 78% of the eligible acres, have been re-enrolled back into the CRP program. It should be noted that the CRP re-enrollment period was a couple of years ago, before the current dramatic rise in grain prices, and improved profitability in crop production. It will be interesting if USDA offers the same CRP re-enrollment options to landowners in the future, the participation, and if the participation rate for CRP re-enrollment stays as high as it was a couple of years ago.
Some of those acres are continuous CRP acres that are on more highly sensitive environmental lands, which will most likely be offered for and encouraged for CRP re-enrollment by USDA. However, the majority of the expiring CRP acres in the coming years are General CRP acres, which may or may not be offered up for re-enrollment by USDA, and landowners may not be as willing to re-enroll the CRP acres, if commodity prices remain at high levels.
CRP Achievements
In 2006, CRP celebrated its 20th anniversary, and two decades of conservation success. CRP was originally established in the 1985 Farm Bill, and today has over 400,000 landowners participating, most of which are farmers and ranchers, and involves nearly 35 million acres under some type of CRP contracts. Some of the 20-year benefits of the CRP program cited by USDA include:
in targeted watersheds, which has generated an additional $ 1 billion in State and private funds for Federal conservation efforts through CRP.
Twelve States have over 1 million acres in CRP, which accounts for about 75% of the CRP acres in the U.S. Following is a listing in order of the top twelve CRP States, how many CRP acres were enrolled on April 30, 2008, and the (decline in CRP acres from September 30, 2007):