GFB News Magazine

Ag provisions included in OBBB

Posted on September 4, 2025 6:53 PM

The “One Big Beautiful Bill,” (OBBB), House Resolution 1, which President Donald Trump signed into law July 4, includes a broad reauthorization of the farm bill’s nondiscretionary provisions, updates and funds many agriculture titles through 2031.

Some of the commodity support programs the updates apply to include Price Loss Coverage (PLC), Agricultural Risk Coverage (ARC), marketing assistance loans and dairy margin coverage. 

For cotton, the PLC seed reference price increases from 36.7 cents/pound to 42 cents/pound, effective with the 2025 crop. The bill increases payments limits under PLC and ARC to $155,000, indexed to inflation, and allows entities such as S-Corps and limited liability companies (LLCs) to be treated the same as general partnerships on how payment limits are structured.

The OBBB solves many of the problems arising from current enrollment restrictions applying to PLC, ARC, and the Stacked Income Protection Plan (STAX), which is a cotton-specific area-wide insurance program. Previously, cotton growers were ineligible to buy STAX if they were enrolled in either PLC or ARC. The OBBB provides producers with better safety net options by (1) enhancing the Supplemental Coverage Option (SCO) area-wide policy so that it functions more like STAX, and (2) continuing to allow growers to purchase SCO and enroll their seed cotton base acres in PLC.

The OBBB increases the cotton loan rate to $0.55 while modifying the Adjusted World Price (AWP) calculations to provide more opportunities for marketing loan gains or loss deficiency payments.

The bill increases the peanut reference price from $535 per ton to $630 per ton, beginning with the 2025 crop year. It provides an additional 30 million new base acres, beginning with the 2026 crop year and increases peanut marketing loan values from $355 per ton to $390 per ton, beginning with the 2026 crop year. A separate peanut payment limit is set at $155,000 per entity.

Tax provisions included in the OBBB expected to help farmers are:

• Estate tax exemption increased to $15 million/individual or $30 million/couple;

• The Section 199A Small Business tax deduction is made permanent at 20%;

• The Section 179 deduction allows farmers & ranchers to deduct up to $2.5 million in qualified equipment expenses;

 • Itemized deductions for personal casualty losses due to federally declared disasters is now permanent. 

Georgia Reps. Rick Allen, Buddy Carter, Andrew Clyde, Mike Collins, Marjorie Taylor Greene, Brian Jack, Barry Loudermilk, Rich McCormick and Austin Scott voted in favor of the bill.

Visit https://gfb.ag/obbbagprovisions for a detailed analysis of the ag provisions in the OBBB provided by American Farm Bureau.