Marketing Loans Induced Acreage Expansion in U.S. Dry Peas

The 2002 Farm Act signaled a new era within the US dry edible pea and lentil industry by initiating a Federal loan program for producers. The program, known as the Marketing Loan Program, assures producers of an effective grower price not lower than the loan rate, thereby reducing market risk. As an...

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Bibliographic Details
Published in:Amber waves 2008-06, Vol.6 (3), p.2
Main Authors: Lin, W, Lucier, G
Format: Article
Language:English
Subjects:
Agricultural production
dry peas
Expansion
exports
Farm loans
Federal legislation
food prices
land use change
Lens culinaris
lentils
Loans
Marketing
Peas
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Summary:The 2002 Farm Act signaled a new era within the US dry edible pea and lentil industry by initiating a Federal loan program for producers. The program, known as the Marketing Loan Program, assures producers of an effective grower price not lower than the loan rate, thereby reducing market risk. As anticipated, area planted to US dry edible green and yellow peas soared from 206,800 acres in 2001 to a record-high 925,500 acres in 2006. To evaluate the impact of the Marketing Loan Program, ERS developed an acreage response model that operates as a system of acreage allocation decisions for dry peas and important alternative crops. As a result, US dry pea export volume quadrupled between 2002 and 2005.
ISSN:1545-875X
1545-8741
1545-875X