If you have not already solved the problem, it appears from the snippet of cfg above that your config file is not configured to announce to your flarm that you have a Mode C transponder on board.

To configure your flarm for transponder add this to your cfg:

# Set what kind of transponder you have installed:
# 0 ... no XPDR (default)
# 1 ... Mode C
# 2 ... Mode S
$pflac,s,xpdr,1