103 – High risk discoveries 2014 Farm Bill

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New Discoveries for high risk farms in the Farm Billhigh risk fields

So, you farm corn and soybeans in the Midwest and you are going to choose ARC county for all your acres.  Not so quick.  If any of these farms have high risk ground you may want to re think that.

I go over why on a high risk farm I am going to go PLC for the farm bill choice, at least the corn acres.  It has all to do with SCO- supplemental coverage option for crop insurance.

Listen and enjoy the farm podcast.

It really shows why for those high risk acres without high levels of affordable insurance that are in the then chairman of the House Ag Committee’s district., why he wanted 2 options for every program participant.

It really gives farmers with high risk acres cheap affordable crop insurance.  Of course now loss ratios are going to be much higher and the anti farm bill crowd will go after crop insurance.  But, hey get it while you can.  As many learned in 2012 you can make more money with a disaster than you can with a big crop.

How did I figure this out?  One I do not always sleep at night. I just run numbers in my head. Then I went to my very good crop insurance agent and looked at the quotes. That sold me on it.

Give up those big ARC payments?  You bet, in 2012 the crop insurance with SCO would have given me $420 more per acre, on high risk ground.

One Comment

  1. Andrew Gauck said:

    Bill, I really enjoy your Podcasts and this one was as valuable as any I have caught! That is because it gets us thinking outside the box. You seem to be good a that.
    In our area, the high risk ground has the ability to insure up to the 85% level but is quite expensive. The main concern my guys have is floodout. That can isolate them from how the remaining county performs and has not traditionally fit for them. With SCO being a “County Policy” on that top 36% in your example, my worry is, only in a drought(2012) type year would carrying this really “Hit a Lick”.
    Thanks for being on top of these angles and Happy New Year!
    Andrew Gauck
    Risk Management Specialist
    Greensburg, IN

    January 5, 2015
    Reply

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