USDA’s Risk Management Agency announced this week they eliminated the Prevented Planting plus 10-percent option for the 2018 crop year and beyond. South Dakota Corn Executive Director Lisa Richardson says it was a cost savings move, but the change will mean farmers in the Northern Plains will lose the prospect of larger potential payouts under prevented planting claims.
While RMA kept the 5-percent buy-up option very few farmers use it. However, the 10-percent option paid out more than $4 billion in indemnities from 1994 to 2013. The move hits North and South Dakota the hardest. Over a two-decade period the 10-percent option on prevent plant led to more than $2 billion in indemnities for North Dakota and $680 million for South Dakota.
Richardson says what’s more of a concern is the program elimination came as a surprise and without Congressional approval. So, that may mean crop insurance is susceptible ahead.
She says the key is to make sure they can preserve crop insurance as the new farm bill moves forward, as it’s the top safety net program for farmers.
