What does the area revenue with harvest price exclusion plan do?

The area revenue with harvest price exclusion plan specifically excludes the potential for upside price protection that might occur if the market price rises at harvest time. In this plan, revenue is calculated based on the average price and yield in a defined area, but it intentionally does not provide the additional coverage that would come from a higher harvest price. As a result, farmers participating in this plan will receive payments based on the lower of the average revenue or the established price, but they won't benefit from rising market prices at harvest. This makes it a targeted approach for managing risks related to yield and price fluctuations without the costs associated with full market price protection.

By excluding the upside of harvest prices, the plan often leads to lower overall premiums compared to plans that include price protection, allowing farmers to manage costs while still addressing revenue risks based solely on area averages instead of individual farm performance.