A counter-cyclical payment is a financial support provided to farmers and producers when market prices for their products fall below a certain level. These payments are designed to stabilize farmers' income during periods of low commodity prices, helping them manage economic fluctuations. The aim is to ensure that agricultural producers can continue their operations despite adverse market conditions.
Counter-cyclical payments are primarily used in the context of agricultural law and commodity programs. They are part of federal policies aimed at supporting farmers during economic downturns. Legal professionals may encounter this term when dealing with agricultural contracts, farm subsidies, and government assistance programs. Users can access legal templates through US Legal Forms to navigate these issues effectively.
Here are a couple of examples of abatement:
For instance, if a farmer grows corn and the market price drops significantly below the established target price, they may receive a counter-cyclical payment to help offset their losses. This payment can be crucial for maintaining their financial stability during tough economic times. (hypothetical example)
The primary legal reference for counter-cyclical payments is found in the U.S. Code, specifically under 7 USCS § 7901, which outlines the definitions and regulations surrounding agricultural payments. Additional provisions may be found in related agricultural legislation.
| Term | Definition | Key Differences |
|---|---|---|
| Direct Payment | Payments made directly to farmers regardless of market conditions. | Counter-cyclical payments depend on market prices, while direct payments do not. |
| Price Support | Government interventions to maintain prices at a certain level. | Price support aims to stabilize prices, whereas counter-cyclical payments provide support when prices fall below a target. |
If you believe you may be eligible for counter-cyclical payments, start by reviewing your crop types and current market conditions. You can apply through your local agricultural office or explore US Legal Forms for templates that can assist you in the application process. If your situation is complex, consider consulting a legal professional for tailored advice.
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Eligibility typically includes major commodities like corn, wheat, and soybeans, but specific criteria may vary.