ARC vs PLC: Comparing Farm Safety Net Programs

How Each Program Works

ARC and PLC are the two main Title I safety net programs established by the Farm Bill. They cover the same set of program commodities but use fundamentally different payment triggers. Farmers must choose one program per commodity per farm — you cannot receive both for the same crop.

PlainFarmData tracks ARC and PLC payments separately by state and year on our programs page, making it possible to compare which program delivered more support in each state over time.

Agricultural Risk Coverage (ARC)

What it tells you: ARC-CO (the county option, chosen by most producers) compares actual county revenue for a commodity to a benchmark revenue. If actual revenue falls below 86% of the benchmark, ARC makes up the difference — up to 10% of the benchmark. The benchmark is an Olympic average (drop the high and low years) of the previous 5 years of revenue.

What it doesn't tell you: ARC payments are capped at 10% of benchmark revenue per acre, so they only cover shallow losses. Deep price collapses or catastrophic yield failures are beyond ARC's coverage range — that is where crop insurance steps in. Also, the 5-year Olympic average benchmark adjusts downward during prolonged low-price periods, reducing future payment potential.

How to use it: Browse ARC payments on PlainFarmData to see which states and years triggered payouts. States with high yield variability (drought-prone areas) tend to trigger ARC more frequently than states with stable yields, even at the same price levels.

Price Loss Coverage (PLC)

What it tells you: PLC triggers when the national marketing year average price for a commodity falls below its statutory reference price. The payment rate is the difference between the reference price and the actual price, multiplied by the farm's payment yield and base acres. PLC is straightforward: if the price is below the reference, you get paid.

What it doesn't tell you: PLC does not respond to yield problems. A farm that loses its entire crop to drought receives no PLC payment if the national price stays above the reference price. Also, PLC payment yields are based on historical farm productivity, not current yields — they may not reflect the farm's actual production capacity.

How to use it: Compare PLC and ARC payment histories by state on PlainFarmData. PLC payments tend to spike in specific years when commodity prices collapse (e.g., low corn prices in 2016-2017), while ARC payments are more broadly distributed across states and years.

Enrollment Patterns and Annual Elections

Under the 2018 Farm Bill, producers make ARC/PLC elections annually, which changed the strategic calculus significantly. Previously, the choice was locked in for the entire bill period, forcing producers to predict market conditions years in advance. Annual elections allow producers to adjust based on current market outlook and commodity-specific price forecasts.

USDA data shows that PLC enrollment increases when prices are trending downward or are near reference price levels, while ARC enrollment rises when revenue risk (price or yield uncertainty) is the dominant concern. The ability to switch annually means enrollment data on PlainFarmData reflects real-time producer sentiment about market conditions and risk exposure.

For individual producers, the annual election means consulting with farm management advisors each year to evaluate which program provides better expected coverage given current price forecasts, yield expectations, and county-level conditions. Decision tools from USDA and land-grant universities can model expected payments under both scenarios.

What This Means for You

Step 1 — Review payment history for your commodity. On PlainFarmData, compare ARC and PLC payments in your state over the past 5-10 years.

Step 2 — Assess your risk profile. If your primary concern is price risk (you produce a commodity with volatile prices but stable yields), PLC may provide better coverage in major price downturns. If yield variability is your bigger risk, ARC-CO is more likely to trigger.

Step 3 — Consider the current price environment. When prices are well above reference levels, PLC is unlikely to pay. ARC may still trigger if county revenue falls below the benchmark due to yield issues.

Step 4 — Consult your local FSA office. Program enrollment happens annually. Your county FSA office can run scenarios comparing expected ARC vs PLC payments under different price and yield assumptions for your specific farm.

Historical Payment Comparison on PlainFarmData

PlainFarmData tracks ARC and PLC payments separately by state, making it possible to see which program delivered more support in each location over time. Key patterns to look for include:

Corn and soybean states tend to show higher ARC payments because revenue-based triggers capture both price and yield variability in these crops. Rice and peanut states often show higher PLC payments because Congress set reference prices at levels that trigger payments in moderate-price years.

The payment data also reveals the financial stakes of the ARC/PLC election. In years when one program paid and the other did not, producers who chose wrong received nothing while their neighbors collected significant payments. This asymmetry drives the intensity of producer interest in program analysis.

Frequently Asked Questions

What is the difference between ARC and PLC?

ARC (Agricultural Risk Coverage) protects against shallow revenue losses by comparing actual county revenue to a benchmark. PLC (Price Loss Coverage) triggers payments when the national marketing year average price falls below a reference price set by Congress. ARC covers revenue declines (price and/or yield), while PLC only responds to price drops. Farmers choose between ARC and PLC for each covered commodity at the start of each farm bill cycle.

Which program pays more, ARC or PLC?

It depends on market conditions. PLC pays more in years with sustained low commodity prices, since it triggers based on price alone. ARC pays more when revenue drops due to poor yields even if prices are moderate, or during shallow price declines that do not breach PLC reference prices. Historical payment data on PlainFarmData shows the year-by-year comparison across states and commodities.

Can I enroll in both ARC and PLC?

You must choose one program per covered commodity per farm. Under the 2018 Farm Bill, producers make ARC or PLC elections annually, which provides more flexibility than previous farm bills that locked in the choice for the entire bill period. You can choose ARC for one commodity and PLC for another on the same farm.

What commodities are covered by ARC and PLC?

ARC and PLC cover major field crops including corn, soybeans, wheat, rice, peanuts, sorghum, barley, oats, and several other commodities with established reference prices. Specialty crops (fruits, vegetables, nursery) are not covered — they have separate support through crop insurance and the Specialty Crop Block Grant Program.