Contact:
Quintrell Hollis, 816-926-3421
Debbie Haugan, 202-690-4271

RMA SEEKS PUBLIC COMMENT ON GRAIN SORGHUM PRICING METHODOLOGY

WASHINGTON, Jul 24, 2009 - Risk Management Agency Administrator William J. Murphy today announced publication in the Federal Register of a notice of Proposed Pricing Methodology for Grain Sorghum for review and comment.

The notice stems from a requirement in the 2008 Farm Bill for RMA's Federal Crop Insurance Corporation (FCIC) to contract with five expert reviewers to “develop and recommend a methodology for determining an expected market price for grain sorghum for both the production and revenue-based plans of insurance to more accurately reflect the actual price at harvest.”

In accordance with the Farm Bill, RMA is publishing all five reviews for public comment.

Proposed Methodology

The expert reviewers were all agricultural economists with experience in the grain sorghum and corn markets and were from within USDA, the grain sorghum industry, or institutions of higher learning. The proposed methodology is by:

Dr. James Richardson, Texas A&M University

RMA/FCIC is proposing selection of the Texas A&M University methdology, determining that it is the most accurate predictor of grain sorghum prices at harvest time, while meeting the Farm Bill's requirements of transparency and replicability.

The other four reviews are by:

Dr. Holly Wang, Purdue University

Chris Cogburn, National Sorghum Producers

Robert Dismukes, Economic Research Service (Note: Copies of the full report available upon request)

Greg Pompelli, Economic Research Service (Note: Copies of the full report available upon request)

Public Comments