According to Hurt, the biggest cost associated with enrolling in ACRE is the 20 percent reduction in direct payments.
"Purdue estimates this is about $2 to $3 per acre for soybeans and about $4 to $6 per acre for corn on average-quality land," he said. "The potential benefit is protection against low revenues that could come from low yields, low prices or a combination of the two."
What makes the decision challenging is that producers can't possibly know by the enrollment deadline whether ACRE or DCP will have the highest returns. That won't be determined until crop yields and prices are known after harvest.
"This spring, the best producers can do is look at the cost to be in ACRE, examine the odds that prices or yields will be low enough to trigger ACRE payments and decide if they are willing to forego some of their direct payments for the added revenue protection that ACRE provides," Hurt said. "The odds of triggering ACRE payments for 2013 appear to be low, but if they do trigger, payments could be high - especially if prices collapse."
Purdue Extension offers free resources to help farmers make revenue-protection decisions, including detailed economic evaluation of ACRE vs. DCP for Indiana corn, soybeans and wheat, at https://ag.purdue.edu/agecon/Pages/agpolicy.aspx.