MANHATTAN, Kan. – Good news has been scarce for wheat growers lately, but there’s a little help available now.

"Beginning this year, wheat growers may graze out their wheat and still collect the loan deficiency payment," said Kansas State University agricultural economist Art Barnaby. "The grazed-out LDP payment will be available on wheat, barley and oats."

Growers must certify all of their wheat acres by May 31. In doing so, they must identify the acres that will be mechanically harvested and those that will be grazed out.

To be eligible, however, no harvesting by mechanical means is allowed on the acres in question. That means no combining, ensilaging or haying.

Growers who elect the graze-out option must be signed up under a production flexibility contract [PFC] with the Farm Service Agency, said Barnaby, who is a farm management specialist with K-State Research and Extension. Also, growers must maintain "beneficial interest" in the wheat or other grazed crop. In other words, growers who cash lease their grazing rights are not eligible for the LDP payment because they have not maintained their "beneficial interest."

"A major consideration is the yield that will be used to determine the amount of the loan deficiency payment," said Barnaby. "If the acres are disaster-affected and if the crop is eligible for insurance payments, then one cannot collect the LDP under grazeout."

On wheat acres that have no weather damage, growers have the option to use the higher of the two – the FSA program yield or county average yield as determined by the National Agricultural Statistics, he added.

As with regular LDP payments, growers will have to select a date to claim the payment.

It’s also important to remember, Barnaby said, that these LDP payments will count in the $75,000 payment limitation. Last year’s $150,000 limitation came after Congress passed disaster aid and loss-of-market legislation.

"Without a change from Congress, the current payment limitation is back to $75,000 for the LDP payment," he said. "The grazed-out wheat acres will not be eligible for loan, so growers will need to use their $75,000 LDP payment limit that applies to all crops. This may be an issue for some growers who also have silage in the fall, because those acres will also need to use the LDP payment.