Report: SDRP Phase 2 Design Leaves Many High-Coverage Farmers with No Path to Payments

Strategic Farm Marketing analysis finds Phase 2 formulas make payouts mathematically impossible for some producers, widening gaps with Phase 1

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An analysis by Dave Janson and Katie Voinorovich of Strategic Farm Marketing concludes that USDA’s decision to exclude the harvest price from Supplemental Disaster Relief Program (SDRP) Phase 2 calculations makes it mathematically impossible for many producers — especially those with high crop insurance coverage — to receive any payment, creating a sharp divide with farmers who benefited under Phase 1. 

Key findings

• No harvest price, no payout path: By omitting the harvest price, the Phase 2 payment trigger can sit above the revenue protection (RP) claim trigger, eliminating eligibility for some producers even with losses.
• High coverage penalized: For 2023 corn, producers at 85% and 80% RP who did not receive a Phase 1 payment have 0% potential to receive a Phase 2 payment, regardless of APH, state, or county.
• Lower coverage fares slightly better: Potential payouts rise modestly at lower coverage levels (e.g., ~1.8% at 75%, ~5.8% at 70%, ~10% at 65%).
• Consistent across crops/years: Similar results appear for corn, soybeans, and soft red winter wheat in 2023 and 2024, reflecting widespread projected-to-harvest price declines.
• Incentive distortion: The structure unintentionally discourages high individual coverage in future years.
• Phase 1 vs. Phase 2 gap: Because Phase 1 included harvest price effects, near-identical outcomes can yield payments in Phase 1 but none in Phases 1 or 2 for otherwise similar producers under Phase 2 rules.

Bottom Line: Understanding the relationship between the RP claim trigger and the SDRP Phase 2 trigger is critical, the authors argue, because the current design means Phase 2 “is truly performing” in ways that exclude many high-coverage producers from relief.

Note: There are apparently a lot of problems with production data filed into USDA as farmers say it does not match their actual records. USDA sources say they are aware of this, and it could take time to correct the data dumps and that farmers and crop insurance companies should “just be patient.”

Also, farm-state lawmakers are upset regarding how USDA’s FPAC has handled Phase 2.

Key Information/Examples from Strategic Farm Marketing Analysis   Due to this relationship between the RP Claim Trigger and the SDRP Phase 2 Payment Trigger, if the producer did not receive an SDRP Phase 1 payment, it is mathematically impossible for producers that took 85% and 80% RP for their 2023 corn crop to receive a payment on SDRP Phase 2. This percentage by coverage level would hold true regardless of the state and county the producer resides in.