The farm bill implementation process continued Monday with an announcement from USDA that it would move forward with changes to crop insurance to provide more coverage levels and to provide beginning farmers with expanded options as well.
USDA Secretary Tom Vilsack said the improvements will provide better protection from weather disaster, market volatility and other risk factors, and the beginning farmer provisions will make crop insurance more affordable and provide greater support when new farmers experience substantial losses.
"Crop insurance is critical to the ongoing success of today's farmers and ranchers and our agriculture economy. These improvements provide additional flexibility to ensure families do not lose everything due to events beyond their control," Vilsack said in a USDA statement.
USDA's Risk Management Agency filed an interim rule with the Federal Register Monday, allowing USDA to move forward with changes to crop insurance provisions.
The provisions allow producers to have enterprise units for irrigated and non-irrigated crops, give farmers and ranchers the ability to purchase different levels of coverage for a variety of irrigation practices, provide guidance on conservation compliance, implement protections for native sod and provide adjustments to historical yields following significant disasters, USDA said.
Beginning farmer crop insurance changes
The Farm Bill authorizes specific coverage benefits for beginning farmers and ranchers starting with the 2015 crop year. The changes announced today exempt new farmers from paying the $300 administrative fee for catastrophic policies.
New farmers' premium support rates will also increase ten percentage points during their first five years of farming. Beginning farmers will also receive a greater yield adjustment when yields are below 60% of the applicable transitional yield. These incentives will be available for most insurance plans in the 2015 crop year and all plans by 2016.
Native sod benefit reductions
Starting in the fall of 2014, producers who till native sod and plant an annual crop on that land will see reductions in their crop insurance benefits during the first four years. Native sod is acreage that has never been tilled, or land which a producer cannot substantiate has ever been tilled for the production of a crop.
The provision applies to acreage in all counties in Iowa, Minnesota, Montana, Nebraska, North Dakota, and South Dakota that is greater than five acres per policy and is producing annual crops.
Additional information on implementation of these changes is available at the RMA website, www.rma.usda.gov.
The interim rule is available to the public on the Federal Register. Written comments on the rule can be submitted by Sept. 2, 2014. All comments will be considered when the rule is made final.