Growers Reap Benefits Even in Good Years

For last year's crop, farmers sold their corn for an average of $1.90 per bushel, only 5 cents below the national floor price. But they received an LDP averaging 44 cents, government payment records show. The difference amounted to $3.8 billion.

The same thing happened in 2004, when the LDP was 27 cents even though the price farmers received when they sold their crops was above the floor. The windfall for farmers was $2.7 billion.

One reason for the discrepancy is that farmers have adopted modern methods to limit their financial risk.

"A farmer who plays it right can make a bundle at times," said Daniel A. Sumner, an agricultural economist at the University of California at Davis.

One who played it right last year was Michael T. Sullivan, who produces a million bushels of corn annually with his three sons in Franklin, Minn. He thrived even during the depressed post-Katrina market.

Well before the storm, Sullivan said, the family had arranged to sell three-quarters of its crop to a local grain elevator for about $2 a bushel. The practice, called "forward contracting," is increasingly common and helps insulate farmers from the market's routine ups and downs.

On top of their contracted price, the Sullivans got the subsidy: $292,054 for that same corn, according to payment records.

Sullivan considers the LDP a godsend, given the uncertainties of farming. "Without it, Main Street Minnesota would have no money to keep the economy rolling," he said.

Richardson also makes no apologies for taking the government money. He contends that the LDP helps keep him and other farmers afloat by offsetting rising energy costs. Maryland farmers, he adds, deserve higher subsidies because they have higher costs and lower yields than Midwestern farmers.

"Without the LDP last year, farmers would have been in deep water," he said recently. As a large farmer, he said, "You handle a lot of dollars, but that's no panacea."

The bigger the farm, the bigger the payouts.

Walker Place, an operation based in Danville, Ill., that farms in 23 counties in six states, has received $3.4 million in LDP checks over the past decade, including $491,726 on the 2005 corn crop, government records show.