By KEVIN WALKER
Michigan Correspondent SOUTH BEND, Ind. — Farmers had time-sensitive decisions to make last week regarding whether to plant a crop or let their fields lie idle and make a claim on their crop insurance.
“Guys actually have until July 1 to put in a prevented corn planting claim,” said Tom Sloma, a crop insurance specialist at Farm Credit Services (FCS) of Mid-America.
The clock started ticking on June 5 for corn growers regarding their crop insurance in Indiana, Ohio and Michigan. According to the FCS, most crop insurance policies include a 25-day late planting period. Acres planted after that date will receive a lower revenue guarantee than those acres planted by the deadline. The coverage is reduced 1 percent per day for each of the next 25 days.
If the corn can’t be planted by June 5, farmers can still plant the original crop after the deadline, even though yields may be reduced; plant an alternative crop, such as soybeans; let the ground lie idle or plant a cover crop and receive a full prevented planting payment; or take partial prevented planting and get 35 percent of the claim on corn and pay 35 percent of the premium – in the last instance beans can’t be planted until July 1. The last choice is called “first crop second crop”: Sloma said it’s a confusing choice and that most growers don’t use that option.
“If you take full prevented planting you can’t plant anything,” Sloma said. “There are approved cover crops, but they can’t be harvested.”
Sloma said growers in northwestern Indiana have been “pretty successful in planting.” In central and eastern Indiana “we’re seeing more claims. We’re seeing a lot more claims in Ohio. They got so much rain. It’s really bad out there in eastern Ohio.”
Sloma described each farmer’s situation as unique.
“At the end of the day a farmer likes to get his fields planted,” Sloma said. “I think they really like to see a crop out there.”
Also, Michigan State University educators have put together a webinar and paper on prevented planting decisions. David Schweikhardt, co-author of the paper, said it’s too early to know how many crop insurance claims are being made and that the information will be relevant until people are done planting.
“If we have a stretch of clear weather for the next week to 10 days, much of this issue will become moot,” Schweikhardt said. “People will be done planting and will probably have planted about what they expected to plant in the beginning.
What kind of yields we have with this slow start, that is another story.”
Schweikhardt said that right now they are just trying to help people understand what their options are: what it means if a farmer plants crop x on June 25, for example. He also said that market prices are a kind of wild card.
“Suppose corn goes to some extraordinarily high price in late June and a producer has been unable to plant. In that case, any sort of corn crop, even one with low yield, could get an advantage over soybeans because of the high corn price.”
A link to the webinar can be found at http://breeze.msu.edu/p93282283/ A link to the webinar as well as Schweikhardt and Roger Betz’ paper on the subject of prevented planting should be available at www.msu.edu/user/steind |
