Winter may not seem like a busy time for farmers, but plans for the 2017 crop year are actively being made during the winter months. Most seed orders have been placed while chemical products and fertilizer programs are being determined. Another important decision to make for 2017 is your crop insurance policy. Now is the time to make any changes to your policy if necessary. The spring sales closing date for corn and soybeans is Wednesday, March 15th. Farmers who need to add coverage, increase coverage, decrease coverage, or cancel coverage, must do so by this deadline.
The spring price for corn and soybeans will start tracking during the month of February. Currently, our corn price is at: $3.88 and soybeans is at: $10.24. By the end of February, we will know what the price is going to be and farmers will know how much their insurance policy can guarantee them. Farmers are seeing coverage amounts decrease substantially compared to a few years ago. Even with higher coverage levels, farmers are struggling to guarantee all input costs. There are no major changes to the crop insurance program this year so decisions can be made soon.
Many farmers ask, “what is everyone else doing?” Unfortunately, there’s not a one-size-fits-all answer to that question because every operation is unique. When considering coverage, there are many factors to bear in mind, but the overall average policy taken out this year is 80-85% enterprise units. There is a significant savings in premium if you qualify for enterprise units. Although this is appealing, it may not work for every operation. 80-85% coverage levels are most popular because many farmers require a higher coverage level this year to guarantee their inputs cost.
With low commodity prices, many farmers are trying to cut costs this year. I would not recommend cutting insurance coverage to save money. Looking at all the inputs farmers buy, crop insurance is the only product that gives them a guarantee. You can rest easy knowing you have adequate coverage if Mother Nature doesn’t cooperate.