More than 630 groups urge senators to oppose crop insurance cuts

More than 630 organizations sent a letter June 22 to the Senate urging them to oppose the introduction of harmful crop insurance amendments as the farm bill moves to the floor.

In the letter, the groups state their opposition to harmful amendments that would reduce or limit participation in crop insurance; make insurance more expensive for farmers during a time of economic downturn in agriculture; or harm private-sector delivery.

“As you consider the 2018 farm bill on the Senate floor, we urge you to oppose harmful amendments to crop insurance, including those that would 1) reduce or limit participation in crop insurance, 2) make insurance more expensive for farmers during a time of economic downturn in agriculture or 3) harm private-sector delivery,” the letter said.

“Crop insurance is a unique risk management tool available to farmers and ranchers. First, crop insurance policies are available for more than 120 individual crops across the country, and the recent development of Whole Farm Revenue insurance makes coverage available to all crops, in all regions and for all types of farms.”

The letter went on to explain that crop insurance is also purchased by farmers, and farmers must prove that they have met a deductible (minimum loss threshold) to be eligible for a payment for a portion of their loss. On average, farmers collectively spend $3.5 to $4 billion per year out of their own pockets for crop insurance coverage and the average deductible is approximately 25 percent of the expected value of the crop.

Also, instead of placing the entire risk for crop insurance on the American taxpayer—like ad hoc disaster assistance does—crop insurance shares risk between the taxpayer, farmers and the private sector delivery system.

“There is no shortage of reasons why farmers, lenders, agriculture input organizations, conservation groups and others have expressed strong support for crop insurance,” the letter continued.

“Without crop insurance most producers simply could not qualify for the operating loans they need to put a crop in the ground. Due to extremely tight margins in agriculture, regulators examining agriculture lending portfolios typically insist borrowers have crop insurance. Crop insurance is available to all types and sizes of producers in all regions.”

The letter then listed other benefits for crop insurance.

“Crop insurance provides for environmental benefits. Crop insurance requires producers to meet wetlands protections and highly erodible lands protections to be eligible for a premium discount,” the letter said.

“Crop insurance is a rapid response solution to disasters. Private sector delivery typically allows farmers who have losses and have met their deductible to receive indemnity payments in less than thirty days, while ad hoc disaster can take months or even years. Crop insurance protects jobs, both on and off the farm. Crop insurance enables farmers to rebound quickly after a disaster and allows producers to pay credit obligations and other input expenses, such as fertilizer and farm equipment.”

The letter concluded with an appeal toward food as a tool of national security.

“Crop insurance is food and fiber security insurance, and food and fiber security is national security. Given the importance of crop insurance, the undersigned organizations urge you to support America’s farmers, ranchers, rural economies and national security by opposing amendments that would harm crop insurance.”

Among the 630-plus signatories to the letter were the American Farm Bureau Federation; National Farmers Union; state and national grower organizations representing corn, soybeans, wheat, sorghum, barley, sugarbeets and sunflowers; agriculture lending institutions and associations; and rural development organizations.

Larry Dreiling can be reached at 785-628-1117 or [email protected].