What Have We Learned from This No Good, Very Bad Year?
By Tara Smith
After a year like 2019, the most you can hope for is 1) you survive and 2) you and those you work with learn from the experience.
In particular, it would be awfully nice to take last year’s lessons learned about the farm safety net – the gaps, the inconsistencies and the ugly warts – and make improvements now so that farmers have more certainty the next time Mother Nature rears her ugly head.
Now there are some things that were almost unavoidable. Certainly, announcements about ad hoc disaster assistance and additional trade aid payments right in the middle of planting season created perhaps the most confusion last spring. But as we know, there is not much USDA can do to control the timing of passage of an ad hoc disaster bill through Congress, and there’s arguably even less USDA can do about presidential tweets announcing farm policy. USDA Secretary Perdue and his team were dealt a rough hand.
However, several areas where tweaks to policy could make future years a little less stressful exist. Here’s a few stakeholders should consider and work with USDA for amenable solutions:
Prevent Plant Buy-Up – Crop insurance policies have prevent plant coverage, and they offer the option of “buying-up” this coverage by 5% (it was 10% until that privilege was taken away in 2017). There are rules and regulations around that buy-up, and not everyone reads those rules and regulations the same way. What can USDA do to improve those rules, make them clearer and be sure they are applied more consistently so farmers have the answers they need? What can crop insurance companies do to get answers to farmers in a timely fashion?
Planting Deadlines – There was a lot of talk last year about extending planting deadlines for crop insurance. Those deadlines are critical to ensuring the crop insurance program is actuarially sound and based on the best science available from local land grant universities. Do resources need to be given to land grants to review and assess these deadlines more frequently? Do actuarially sound changes need to be made before the next growing season?
Harvest Price Option on Prevent Plant – It was a surprise to many farmers last year that there was no harvest price on prevent plant payments. Would it be a useful addition to the crop insurance toolbox with the appropriate premium adjustments?
Haying and Grazing Cover Crops – USDA provided considerable flexibility for the allowance to hay and graze cover crops, including the flexibility to sell that hayed crop, instead of just using it on-farm or for donation. Are there less extreme flexibilities that should be considered as regular practice?
There isn’t much that can be done at this point to make the 2019 crop year any better, but there are a lot of avenues farmers, the crop insurance industry, USDA and other stakeholders can consider for ways to make the safety net better for next time. Because there’s always a next time.
As executive vice president for Michael Torrey Associates, Tara Smith leads a team of staff focused on developing and implementing legislative and regulatory strategies for clients, including ISA. Smith previously worked as a senior professional staff for the Senate Agriculture Committee under Senator Pat Roberts (R-KS) where she covered commodity programs, crop insurance and disaster assistance. Smith grew up on a corn and soybean farm in central Illinois.