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ple cotton, designated by the Secretary, having 
characteristics needed for various end uses for 
which United States upland cotton is not suit-
able and grown in irrigated cotton-growing re-
gions of the United States designated by the 
Secretary or other areas designated by the Sec-
retary as suitable for the production of the vari-
eties or types; and 
(B) is ginned on a roller-type gin or, if au-
thorized by the Secretary, ginned on another 
type gin for experimental purposes. 
(9) FAR
EAST
PRICE.—The term ‘‘Far East 
price’’ means the Friday through Thursday average 
price quotation for the three lowest-priced growths 
of upland cotton, as quoted for Middling (M) 13⁄32- 
inch cotton, delivered C/F Far East. 
(10) LOAN COMMODITY.—The term ‘‘loan com-
modity’’ means wheat, corn, grain sorghum, feed 
barley, malt barley, oats, upland cotton, extra long 
staple cotton, long grain rice, medium grain rice, 
short grain rice, soybeans, peanuts, other oilseeds, 
wool, mohair, honey, dry peas, lentils, and small 
chickpeas. 
(11) OTHER OILSEED.—The term ‘‘other oil-
seed’’ means a crop of sunflower seed, rapeseed,
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canola, safflower, flaxseed, mustard seed, crambe, 
sesame seed, or, if designated by the Secretary, an-
other oilseed. 
(12) PAYMENT
ACRES.—The term ‘‘payment 
acres’’, with respect to a covered commodity on a 
farm, means 85 percent of the base acres for the 
covered commodity, on which direct payments and 
counter-cyclical payments are made. 
(13) PAYMENT
YIELD.—The term ‘‘payment 
yield’’ means the yield established for direct pay-
ments and counter-cyclical payments under section 
1102 or 1302 of the Farm Security and Rural In-
vestment Act of 2002 (7 U.S.C. 7912; 7952), as in 
effect on the day before the date of the enactment 
of this Act, for a farm for a covered commodity. 
(14) PRODUCER.— 
(A) IN GENERAL.—The term ‘‘producer’’ 
means an owner, operator, landlord, tenant, or 
sharecropper that shares in the risk of pro-
ducing a crop and is entitled to share in the 
crop available for marketing from the farm, or 
would have shared had the crop been produced. 
(B) 
HYBRID
SEED.—In 
determining 
whether a grower of hybrid seed is a producer, 
the Secretary shall—
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(i) not take into consideration the ex-
istence of a hybrid seed contract; and 
(ii) ensure that program requirements 
do not adversely affect the ability of the 
grower to receive a payment under this 
title. 
(15) 
SECRETARY.—The 
term 
‘‘Secretary’’ 
means the Secretary of Agriculture. 
(16) STATE.—The term ‘‘State’’ means each of 
the several States of the United States, the District 
of Columbia, the Commonwealth of Puerto Rico, and 
any other territory or possession of the United 
States. 
(17) TARGET PRICE.—The term ‘‘target price’’ 
means the price per bushel (or other appropriate 
unit in the case of upland cotton, rice, peanuts, and 
other oilseeds) of a covered commodity used to de-
termine the payment rate for counter-cyclical pay-
ments under section 1103. 
(18) UNITED
STATES.—The term ‘‘United 
States’’, when used in a geographical sense, means 
all of the States. 
(19) UNITED STATES PREMIUM FACTOR.—The 
term ‘‘United States Premium Factor’’ means the 
percentage by which the difference in the United
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States loan schedule premiums for Strict Middling 
(SM) 11⁄8-inch cotton and for M 13⁄32-inch exceeds 
the difference in the applicable premiums for com-
parable international qualities delivered C/F Far 
East. 
Subtitle A—Direct Payments and 
Counter-Cyclical Payments 
SEC. 1101. ADJUSTMENTS TO BASE ACRES. 
(a) TREATMENT OF CONSERVATION RESERVE CON-
TRACT ACREAGE.— 
(1) IN GENERAL.—The Secretary shall provide 
for an adjustment, as appropriate, in the base acres 
for covered commodities for a farm whenever either 
of the following circumstances occurs: 
(A) A conservation reserve contract en-
tered into under section 1231 of the Food Secu-
rity Act of 1985 (16 U.S.C. 3831) with respect 
to the farm expires or is voluntarily terminated. 
(B) Cropland is released from coverage 
under a conservation reserve contract by the 
Secretary. 
(2) SPECIAL PAYMENT RULES.—For the crop 
year in which a base acres adjustment under para-
graph (1) is first made, the owner of the farm shall 
elect to receive either direct payments and counter-
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cyclical payments with respect to the acreage added 
to the farm under this subsection or a prorated pay-
ment under the conservation reserve contract, but 
not both. 
(b) PREVENTION OF EXCESS BASE ACRES.— 
(1) REQUIRED REDUCTION.—If the sum of the 
base acres for a farm, together with the acreage de-
scribed in paragraph (2), exceeds the actual crop-
land acreage of the farm, the Secretary shall reduce 
the base acres for 1 or more covered commodities for 
the farm so that the sum of the base acres and acre-
age described in paragraph (2) does not exceed the 
actual cropland acreage of the farm. 
(2) OTHER ACREAGE.—For purposes of para-
graph (1), the Secretary shall include the following: 
(A) Any acreage on the farm enrolled in 
the conservation reserve program or wetlands 
reserve program under chapter 1 of subtitle D 
of title XII of the Food Security Act of 1985 
(16 U.S.C. 3830 et seq.). 
(B) Any other acreage on the farm en-
rolled in a conservation program for which pay-
ments are made in exchange for not producing 
an agricultural commodity on the acreage.
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(3) SELECTION OF ACRES.—The Secretary shall 
give the owner of the farm the opportunity to select 
the base acres against which the reduction required 
by paragraph (1) will be made. 
(4) EXCEPTION FOR DOUBLE-CROPPED ACRE-
AGE.—In applying paragraph (1), the Secretary 
shall make an exception in the case of double crop-
ping, as determined by the Secretary. 
(c) PERMANENT REDUCTION IN BASE ACRES.— 
(1) IN GENERAL.—The owner of a farm may 
reduce, at any time, the base acres for any covered 
commodity for the farm. 
(2) ADMINISTRATION.—The reduction shall be 
permanent and made in the manner prescribed by 
the Secretary. 
SEC. 1102. AVAILABILITY OF DIRECT PAYMENTS. 
(a) PAYMENT REQUIRED.—For each of the 2008 
through 2012 crop years of each covered commodity, the 
Secretary shall make direct payments to producers on 
farms for which payment yields and base acres are estab-
lished. 
(b) PAYMENT RATE.—The payment rates used to 
make direct payments with respect to covered commodities 
for a crop year are as follows: 
(1) Wheat, $0.52 per bushel.
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(2) Corn, $0.28 per bushel. 
(3) Grain sorghum, $0.35 per bushel. 
(4) Barley, $0.24 per bushel. 
(5) Oats, $0.024 per bushel. 
(6) Upland cotton, $0.0667 per pound. 
(7) Rice, $2.35 per hundredweight. 
(8) Soybeans, $0.44 per bushel. 
(9) Other oilseeds, $0.0080 per pound. 
(10) Peanuts, $36.00 per ton. 
(c) PAYMENT AMOUNT.—The amount of the direct 
payment to be paid to the producers on a farm for a cov-
ered commodity for a crop year shall be equal to the prod-
uct of the following: 
(1) The payment rate specified in subsection 
(b). 
(2) The payment acres of the covered com-
modity on the farm. 
(3) The payment yield for the covered com-
modity for the farm. 
(d) TIME FOR PAYMENT.— 
(1) IN GENERAL.—In the case of each of the 
2008 through 2012 crop years, the Secretary may 
not make direct payments before October 1 of the 
calendar year in which the crop of the covered com-
modity is harvested.
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(2) ADVANCE PAYMENTS.— 
(A) OPTION.—At the option of the pro-
ducers on a farm, up to 22 percent of the direct 
payment for a covered commodity for any of the 
2008 through 2011 crop years shall be paid to 
the producers in advance. 
(B) MONTH.— 
(i) SELECTION.—The producers shall 
select the month within which the advance 
payment for a crop year will be made. 
(ii) OPTIONS.—The month selected 
may be any month during the period be-
ginning on December 1 of the calendar 
year before the calendar year in which the 
crop of the covered commodity is harvested 
through the month within which the direct 
payment would otherwise be made. 
(iii) CHANGE.—The producers may 
change the selected month for a subse-
quent advance payment by providing ad-
vance notice to the Secretary. 
(3) REPAYMENT OF ADVANCE PAYMENTS.—If a 
producer on a farm that receives an advance direct 
payment for a crop year ceases to be a producer on 
that farm, or the extent to which the producer
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shares in the risk of producing a crop changes, be-
fore the date the remainder of the direct payment is 
made, the producer shall be responsible for repaying 
the Secretary the applicable amount of the advance 
payment, as determined by the Secretary. 
(e) PROHIBITION ON DE MINIMIS PAYMENTS.—If 
the total direct payment to be paid to a producer on a 
farm for all covered commodities is less than $25.00, the 
Secretary shall not tender the direct payment to the pro-
ducer. 
SEC. 1103. AVAILABILITY OF COUNTER-CYCLICAL PAY-
MENTS. 
(a) PAYMENT REQUIRED.—For each of the 2008 
through 2012 crop years for each covered commodity, the 
Secretary shall make counter-cyclical payments to pro-
ducers on farms for which payment yields and base acres 
are established with respect to the covered commodity if 
the Secretary determines that the effective price for the 
covered commodity is less than the target price for the 
covered commodity. 
(b) EFFECTIVE PRICE.—For purposes of subsection 
(a), the effective price for a covered commodity is equal 
to the sum of the following: 
(1) The higher of the following:
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(A) The national average market price re-
ceived by producers during the 12-month mar-
keting year for the covered commodity, as de-
termined by the Secretary. 
(B) The national average loan rate for a 
marketing assistance loan for the covered com-
modity in effect for the applicable period under 
subtitle B, except that, for the purpose of calcu-
lating counter-cyclical payments under this sec-
tion for rice and barley, the Secretary shall es-
tablish national average all rice and all barley 
loan rates. 
(2) The payment rate in effect for the covered 
commodity under section 1102 for the purpose of 
making direct payments with respect to the covered 
commodity. 
(c) TARGET PRICE.—For purposes of subsection (a), 
the target prices for covered commodities shall be as fol-
lows: 
(1) Wheat, $4.15 per bushel. 
(2) Corn, $2.63 per bushel. 
(3) Grain sorghum, $2.57 per bushel. 
(4) Barley, $2.73 per bushel. 
(5) Oats, $1.50 per bushel. 
(6) Upland cotton, $0.70 per pound.
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(7) Rice, $10.50 per hundredweight. 
(8) Soybeans, $6.10 per bushel. 
(9) Other oilseeds, $0.1150 per pound. 
(10) Peanuts, $495.00 per ton. 
(d) PAYMENT RATE.—The payment rate used to 
make counter-cyclical payments with respect to a covered 
commodity for a crop year shall be equal to the difference 
between— 
(1) the target price for the covered commodity; 
and 
(2) the effective price determined under sub-
section (b) for the covered commodity. 
(e) PAYMENT AMOUNT.—If counter-cyclical pay-
ments are required to be paid under this section for any 
of the 2008 through 2012 crop years of a covered com-
modity, the amount of the counter-cyclical payment to be 
paid to the producers on a farm for that crop year shall 
be equal to the product of the following: 
(1) The payment rate specified in subsection 
(d). 
(2) The payment acres of the covered com-
modity on the farm. 
(3) The payment yield for the covered com-
modity for the farm. 
(f) TIME FOR PAYMENTS.—