Harvest Risk Management Newsletter
With this year’s wet conditions, we continue to get questions from our crop insurance customers about late planting, replants, prevent plants, and failed first crops. We also have information for those of you with GRIP or GRP policies.
Late planting is when a crop is planted during a crop’s late planting period. For corn, that period started on June 6 and lasts until June 30. If you purchased an APH, CRC, or RA policy and you plant during this period, your coverage drops by 1% per day. For example, if you plant on June 15, your coverage would be reduced by 10%. The late planting period for soybeans started on June 16 and lasts until July 10.
Late planted acres are reported on your acreage report and do not require advanced reporting with your agent.
If you purchased GRP or GRIP, late planting is not an issue for you, but in order to have coverage, you must have planted by acreage reporting date. The acreage reporting date for Illinois is July 15 and the acreage reporting date in Iowa is June 30. If a GRP or GRIP claim is triggered for your county, you will only receive a claim check for the acres that you plant by the acreage reporting date.
Replant is when you have planted a crop and, due to an insurable cause of loss, you would like to replant affected acres to the same crop. Since we are well into June, we assume this would only come into play with soybeans at this time. If you do plan to replant, you must contact us ahead of time so that we can file a claim and an adjuster can contact you to authorize the replant. With a replant claim on soybeans, you will be eligible to be reimbursed for your expenses up to $40.02 per acre. Replant is only available for APH, CRC, and RA policies and you must replant 20 acres or 20% of a unit (whichever is less) to qualify.
Prevent plant occurs when acres were unable to be planted by the final plant date. Once again, this coverage is only available for APH, CRC, and RA policies and you must have been prevented from planting 20 acres or 20% of a unit (whichever is less) to qualify. There are other requirements that must be met before you will get a claim check so please
contact your agent to see if you could qualify. Since we are past the final plant dates for corn and soybeans, it is important that you contact us as soon as possible if you have acres in which you were unable to plant. The prevent plant payment is 60% of your crop insurance coverage. So if you purchased 80% RA and you have a 150 APH, your prevent plant payment will be 60% of (.8 X 150 X 5.40) or $388.80/acre. By the way, if the harvest price this fall is higher than $5.40, that payment will increase accordingly.
You could have a situation where you were unable to plant corn and now the field is dry enough to go ahead and plant soybeans. If you plant the soybeans during corn’s late planting period, you get nothing on the corn, but you have coverage on the soybeans. If you plant the soybeans after corn’s late planting period, you will get 35% of the 60% payment explained above and you get coverage on the soybeans. Keep in mind that you will pay 35% of the corn’s premium on those acres and pay full premium on the soybeans.
Failed First Crop/Second Crop
We are getting some calls about planting soybeans on drowned out corn acres. If you have an APH, CRC, or RA policy, YOU MUST call us before planting the soybeans so the adjuster can document the production on the corn. Then you have the option of insuring the soybeans or not insuring them. If you want full insurance on the soybeans, you will get 35% coverage on the corn and pay 35% of the premium. You could get the rest of the corn claim if 65% of the corn claim (net of 65% of the premium) is more than 100% of any soybean claim.
GRIP and GRP policies are also eligible for failed first crop/second crop provisions. These provisions work the same as with APH, CRC, or RA policies EXCEPT with GRIP and GRP you can get coverage on corn acres which you intended to plant in addition to failed corn acres which were planted. For example, let’s say you intended to plant a 40-acre field of corn and you were only able to get 20 acres of corn planted. Then the rains came and the 20 planted acres were flooded and killed. Now the whole 40 acres have dried out and you can plant soybeans. Even with GRIP and GRP, you have the option of insuring the soybeans. If you do insure the soybeans, you are eligible for at least 35% of any GRIP or GRP payment on all 40 acres of corn (and you will pay 35% of the premium on corn). You could get the rest of the corn claim if 65% of the corn claim (net of 65% of the premium) is more than 100% of any soybean claim. The only requirements here are to certify at FSA that you had a failed or prevented first crop and inform your agent whether you want insurance on the soybeans before your acreage reporting date. You should also keep seed and chemical documents that show you planted or intended to plant those corn acres.
The acreage reporting deadline is June 30th for Iowa and July 15th for Illinois. Once you have certified your acres at the FSA office, you will need to meet with your agent to complete your acreage report. In spite of some FSA offices extending the date to certify to August 15th, we still have the deadlines of June 30th for Iowa and July 15th for Illinois.
Save the date
The Iowa Customer Appreciation game will be held on July 2, 2008 in Davenport, Iowa. The game will be at Modern Woodmen Park for the Quad Cities River Bandits baseball game. The game will start at 7:00 p.m.
A correct on the date for the third annual Illinois Customer Appreciation game for the Kane County Cougars is August 13, 2008 not August 6, 2008. The game will start at 6:30 p.m. Please join us for the picnic, game, and fireworks!
Harvest Risk Management will be hosting a seminar July 28th and July 29th. The July 28th seminar will be in Moline, Illinois at John Deere’s World Headquarters and the July 29th will be at Kishwaukee Community College in Malta, Illinois. The primary speaker will be Art Barnaby from Kansas State University. He will be discussing the new ACRE decision for the 2009-2012 crop years. He will also be discussing all the risks of farming in today's Ag Economy.
Art Barnaby was raised on a farm in Kansas and received his Ph. D in Agricultural Economics from Texas A & M. Art joined the Agricultural Economics faculty at Kansas State in 1979 and currently holds the rank of Professor. He conducts education programs on financial planning, government commodity programs, and crop insurance. Art co-authors a Kansas State University Risk Management WEB page and a co-author of a recently published book titled “Managing Risk Through Crop Insurance”.
NASS to Assess Impact of Midwest Flooding on 2008 crop Acreage
The U.S. Department Agriculture’s National Agricultural Statistics (NASS) is taking several steps to assess the impact of the extraordinary rainfall in the Midwest on 2008 crop acreage. NASS will release the 2008 Acreage report as scheduled on June 30 at 8:30 a.m. EDT. However, NASS collected most of the acreage data during the first two weeks of June, before the majority of the flooding occurred. In the Acreage report, NASS will use standard procedures to estimate planted area. But in an effort to more accurately determine how much of the planted area will actually be harvested for grain, NASS will re-interview producers during the week of June 23 in affected area of Illinois, Indiana, Iowa, Minnesota, Missouri, and Wisconsin. This will provide additional information about producers’ harvesting intentions for corn, soybeans, and sorghum.
Since some producers may be difficult to contact or may still be assessing their options, NASS also plans to conduct a more extensive update of planted and harvested acreage in July. This information will be reflected in the August 12
Crop Production report.
John Deere Foundation provides $1 Million to help flood relief for U.S. Midwest
MOLINE, Illinois (June 17, 2008)— The John Deere Foundation Board of Directors has approved a $1 million grant to assist the American Red Cross in relief efforts for victims of flooding in the U.S. Midwest. The money was donated to the American Red Cross National Disaster Relief Fund.
"The flooding in the Midwest has devastated many communities and thousands of families," said Amy Nimmer, president of the John Deere Foundation. "We want to help during these difficult times and believe the American Red Cross is well positioned in this situation to ensure that our financial support is used wisely to assist families and communities."
Flooding in the Midwest has seriously affected communities in five states, including Iowa, Indiana, Missouri, Nebraska and Wisconsin. Iowa has been the most severely impacted with more than 80 of its 99 counties declared disaster areas.
"John Deere customers, employees, dealers and suppliers across the Midwest have all been impacted by this natural disaster," Nimmer said. "We believe our donation and the donations of many others will assist all families in the region to recover and find hope in the future."
John Deere Foundation is the philanthropic organization established by Deere & Company in 1948 to help improve communities and society through charitable grants for education, human services, community development, arts and culture, and world hunger.