The USDA Risk Management Agency has announced the crop insurance harvest prices for wheat. The agency will use a price of $9.86 per bushel for winter wheat and $9.21 per bushel for spring wheat.
Earlier in August, some Washington farmers expressed concern over the prices USDA used to determine crop insurance.
Farmers and grain merchandisers said the Portland soft white wheat export bid price range is too wide, and questioned whether the lower end of the range accurately reflected market value.
Michelle Hennings, executive director of the Washington Association of Wheat Growers, said she’s hearing from some Walla Walla County farmers who still feel that pricing issues during the Aug. 2-11 period may have kept the final harvest price 25 cents lower than it should be.
WAWG is working with RMA to investigate the pricing calculation during that period and prevent something similar from happening in the future, Hennings said. The organization will also work with the agency to address price discovery in future farm bills.
The agency published Frequently Asked Questions in response to grower concerns.
The winter wheat harvest price is calculated from daily prices during August, according to the agency.
Only bids from participating elevators that export soft white wheat to other countries are captured and reported by USDA’s Agricultural Marketing Service. Bids from other elevators are not included, and the harvest prices issued by RMA are not designed to reflect local prices at any particular elevator.
Factors that impact prices at a local elevator can include its location, which can determine how far an elevator may need to ship grain to end-users or export elevators; whether that’s by train, rail or barge; and unique growing conditions that affect production and quality.
“It is important to use a price for crop insurance that is designed to be reflective of the market as a whole, and not any single local elevator,” the agency states.
In accordance with the crop policy, RMA will use the values reported by the Agricultural Marketing Service and will not adjust higher the prices reported by AMS in early August, according to the agency.
No further action is planned, said Ben Thiel, director for the agency office in Spokane, which serves Idaho, Oregon, Washington and Alaska.
Crop insurance is vital for farmers, Hennings said.
“It’s important that it’s funded at the national level because of years like this,” Hennings said.
Farmers this year face a double whammy of drought that has reduced yields and raised the protein levels in some varieties, prompting elevators to pay less. For many farmers, the result is less wheat to sell at lower prices.
WAWG is looking to include high-protein wheat in a national disaster ad-hoc program, Hennings said.