Capital Press File
Cold weather that damaged wheat across the central and southern Plains and southern Midwest illustrates the need for a new farm bill with adequate crop insurance coverage, a National Association of Wheat Growers leader says.
Gordon Stoner, a Montana farmer and president of NAWG, cited “unusually cold temperatures and snowy conditions,” with damage to about one-quarter of the hard red wheat belt in the central Plains and winter kill in southern Indiana, southern Ohio and northern Kentucky.
Several titles in the current farm bill cover crop insurance, Stoner told the Capital Press. Adequate crop insurance is the organization’s top priority for the new farm bill, he said.
Multi-peril insurance covers losses due to winter kill and other weather-related problems, and Agriculture Risk Coverage and Price Loss Coverage — known by the initials ARC and PLC — help protect against low yields and low commodity prices, Stoner said.
“The farm bill is critical to helping ag country manage systemic risk,” he said.
Without crop insurance, younger farmers or those with less capital won’t be able to farm. The first thing bankers ask farmers is their crop insurance guarantee, Stoner said.
“Understandably, the banker wants to understand, if the weather turns against us, how is he going to be repaid,” he said. “Without a farm bill, without crop insurance, only the wealthiest farmers could afford to self-insure and the big farms would grow bigger.”
Opponents such as the Heritage Foundation and American Enterprise Institute claim farmers make money on crop insurance, which isn’t the case, Stoner said.
“Crop insurance keeps you in business for another year,” he said.
Those farmers affected by the hard winter would have the resources in the spring to mitigate the loss, he said.
Stoner expects crop insurance to continue to be a target as a new farm bill is negotiated, including efforts to eliminate the harvest price option, which has helped farmers work through price volatility, he said. The coverage pays off at the commodity price during harvest or a pre-determined price, whichever is higher.
“The last farm bill, there were compromises made in regards to tying conservation to crop insurance,” he said. “We really thought that would keep them at bay for a season, but no more than the deal had been struck, they started in immediately on additional things, as well as the old drumbeat.”
Stoner said he’s “hopeful, but not assured” that the new bill will be satisfactory and available when the old bill expires in September. The House Agriculture Committee is keeping its version of the bill under wraps until leadership guarantees discussion time on the floor, he said. The Senate committee is not as far along and is still working with farm groups, he said. Stoner said the House could take action in late January or February, and the Senate in the summer.
“Certainly crop insurance will be there, there is no doubt in that,” he said. “Whether there could be some chipping away at it, always a possibility.”