NEWARK, Del. - Fanning
involves many kinds of risk. There
are production risks, such as yield
variability due to weather. These
can be reduced by diversifying
production or by irrigating. There
are physical risks which can be
reduced by safe fanning practices.
There are marketing risks which
can be managed by using different
marketing strategies (cash sales,
forward contracting, commodity
options or hedging on the futures
market) to lock in a profitable
price. And there are financial risks
incurred when borrowing money.
Failure to manage any of these
risks effectively can put a farmer
out of business.
Many farmers today are in
serious financial trouble. Whether
they stay in production through the
end of this decade will depend on
how well they manage their affairs
over the next few years in order to
remain on the land until times get
better. This calls for skillful use of
survival tactics.
Multi-peril crop insurance is one
survival tactic producers can use
to protect themselves from income
loss because of low yields. Ac
cording to University of Delaware
assistant extension farm
management specialist Mark
Kooker, insurance can be a
valuable risk reduction tool on
farms that are prone to yield
fluctuations.
“When you’ve borrowed money
you’re in great financial jeopardy
if you can’t pay your debts,”
Kooker says. “Crop insurance is
the only federal program that
deals with financial risk by
allowing farmers to protect
themselves against losses due to
crop failure.”
Multi-peril insurance provides
coverage against the following
production risks: adverse weather
conditions such as drought, ex
cessive rain, hail, wind,
Del.
Extension offers crop insurance advice
hurricanes, tornados or lightning;
insect infestations; plant diseases;
flood; wildlife damage; fire;
earthquake or volcano damage.
Crop insurance does not cover
poor farming practices, theft or
low commodity prices.
Yield goals on eligible
vegetables in 1985 will be
established using either growers’
production records or county
records.
Under the grower yield cer
tification (-GYC) plan, says
Kooker, if a grower has production
records for the past five years,
these figures will be used to certify
yield averages for that particular
farm. If the grower can document
less than five years’ yields, these
will be combined with county
records to determine yield goals
for insurance purposes.
“The higher your production
average, the lower your unit cost
for insurance, so if your yields are
routinely above the county
average, it pays to be able to show
this,” Kooker says.
Three price levels and three
coverage levels are available for
each crop, the specialist says.
Coverage level one, for SO percent,
protects the policyholder against
more than SO percent reduction in
yield. Level two provides 65 per
cent coverage (against a yield loss
of over 35 percent), and level three
gives the grower 75 percent
coverage (or protection against
more than a 25 percent loss). In
deciding how much coverage to
buy, it is important to know the
probability of a loss for a given
crop.
Wtien dues u pay'to have crop
insurance? “Your financial
position and yield variability are
the major factors to consider,”
Kooker says. “This is my rule of
thumb in advising farmers; Look
back over your yields and see if
you had more than 25 percent loss
any year of the last five to ten
years. If you did, consider using
crop insurance.
“A second test,” he says, “is to
look at your farm’s current
financial position. Can you afford
another major loss? If not, con
sider crop insurance.”
According to Kooker, multi-peril
crop insurance will eventually
replace all ASCS/USDA crop
disaster programs now in effect.
The decision to go this route was
Planting of corn, soybeans,
HARRISBURG - Pennsylvania
farmers intend to plant more acres
of corn, oats and soybeans than in
1964, according to the Penn
sylvania Crop and Livestock
Reporting Service.
Intended acreage to be planted
and percent change from hut year
are as follows: corn, 1,870,000
acres, up five percent; oats,
380,000 acres, up <N ' percent;
\bu need
rootworm
protection
and more
Count on LORSBAN* 15G insecticide for excellent rootworm protec
tion, plus outstanding control of cutworms, wireworms and many other
pests. LORSBAN 15G is non-phytotoxic...won’t hurt germinating seed.
And it won’t leach out of the root zone during spring and summer
rains. Stop in today for full details on LORSBAN 15G... the rootworm
insecticide that controls cutworms, too.
LORSBAN* 15G. It’s convincing folks who aren’t easily
convinced.
To get your free calibration scale and copy of the Scouting Guide for
LORSBAN* 15G Insecticide, call us at 1-800-258-CHEM.
'Trademark of The Dow Chemical Company
made in 1960. The federal gover
nment’s goal is to cover all U.S.
commercial crops by 1987, using
either GYC or actual production
history (APH) to establish yield
goals.
To cut costs, the government has
changed the way it markets crop
insurance. As in the past, all
policies were underwritten by the
Federal Crop Insurance Cor
poration. But in most parts of the
country, in 1965 policies are being
oats will increase
barley, 70,000 acres, down seven
percent; all hay, 1,980,000 acres,
unchanged; soybeans, 200,000
acres, up 14 percent; and tobacco,
12,000 acres, unchanged.
United States farmers intend to
plant more acres of com, oats,
barley and all hay, but fewer acres
of tobacco and soybeans. Intended
acreage to be planted and percent
STOP IN AT YOUR LOCAL LORSBAN DEALER
FOR MORE INFORMATION
sold through private companies.
There are several ways fanners
can find out about insuring their
crops. They can contact an agent
who sells crop insurance, the
ASCS, or their, county extension
office. They can also call Kooker
directly at 302-451-2511. He has
prepared a fact sheet, “Multi-Peril
Crop Insurance: A Management
Tool,” which is available at all
Delaware extension offices.
change from last year are as
follows: com, 82.02 million acres,
up two percent; oats, 12.04 million
acres, up five percent; barley,
12.38 million acres, up four per
cent; all hay, 62.28 million acres,
up one percent; soybeans, 64.36
million acres, down five percent;
and tobacco, 714,690 acres, down 10
percent.