The value of US crop production this year will probably be about $7 billion more than last year, which is good news for farmers and taxpayers.

Crop prices are higher this year due in part to increased demand for corn and soybeans to make ethanol and biodiesel.

USDA Chief Economist Keith Collins says that means the government will be paying out less to farmers.

“As market prices have strengthened in the second half of 2006 for crops, we’ve seen all of the price-based payments that are made to farmers go down,” said Collins. “In 2005, direct government payments to farmers were $24 billion. This year, 2006, we are estimating that they will be about $16.5 billion, an $8 billion decline in one year.”

Much of that is due to lower marketing loan benefits, which are price based.