Slow planting prompts insurance deadline extension requests: Extensions unlikely for 2014, but possible in future
FARGO — With a wet, late planting season, farmers are approaching planting deadlines for full crop insurance compensation on various crops.
Sen. Heidi Heitkamp, D-N.D., is asking the U.S. Department of Agriculture to consider delaying the final crop insurance planting deadline for corn this year and other crops in future years.
As of Monday, the National Agricultural Statistics Service pegged corn planting progress at a mere 17 percent in North Dakota and 53 percent in Minnesota, and a more normal 73 percent in South Dakota.
Spokesman Todd Duetz sidestepped a question about whether it is realistic to change the corn planting date from May 25 for this year, but said Heitkamp is hopeful the USDA would give it “full consideration,” and noted that asking for the relief underlines the need for action in future years for other crops. Heitkamp wants the USDA to consider pushing back final planting dates for early spring crops in 2015 and subsequent years.
Doug Hagel, regional director for the federal Risk Management Agency, based in Billings, Mont., said the contracts with reinsurers are submitted in the summer of the previous year and finalized Nov. 30 each year.
“After that period, you can’t change anything without having some impact with the producers — you don’t want to do that — or with the insurance companies who are carrying the risk,” he said.
Hagel acknowledges it is more plausible to talk about changing policies for future years, which are based on research and statistics from universities and the Agricultural Research Service, among others. He acknowledges farmers can still plant during their late planting period, but face a reduced coverage, which offsets the risk.
He added that farmers also typically plant shorter-season varieties during late planting, which tends to reduce yields.
“But the new varieties are changing, getting better — getting out of the ground quicker and moving faster” in development, Hagel said.
He said sugar beet cooperatives in the region have been talking with RMA about changing planting deadlines for future years from the current May 31 to June 10.
Decrease after deadline
Scott Stofferahn, executive vice president for Golden Growers Cooperative based in Fargo, a part-owner of the ProGold LLC corn fructose plant in Wahpeton said it is better for processors, ethanol makers and livestock producers to have farmers plant corn and other crops, rather than to have millions of acres go unplanted. Farmers already can plant after the crop insurance deadline May 25, for example, but their yield guarantee declines by 1 percent for every day’s delay.
In an example, if the guarantee goes down by 5 percent because of a five-day delay, that means a loss of RMA protection on five bushels. At $4 a bushel, that amounts to $20 per acre.
Stofferahn, who was FSA executive director during the presidency of Bill Clinton, said the last time federal officials changed the planting date, the insurance companies resisted because of its impact on underlying risk in the reinsurance agreements. Hagel remembers that the reinsurance companies had to be compensated for the increased risk.
North Dakota is furthest behind in planting in the region. As of Monday, the National Agricultural Statistics Service reports progress at:
- North Dakota: Corn, 17 percent planted, compared with a 54 percent five-year average; soybeans, 5 percent planted, 25 percent average; sunflowers, 1 percent planted, 10 percent average; canola, 14 percent planted, 44 percent average; durum, 14 percent planted, 41 percent average; spring wheat, 25 percent planted, 55 percent average; barley, 22 percent planted, 49 percent average; oats, 29 percent planted, 56 percent average; flax, 4 percent planted, 27 percent average; dry beans, 2 percent planted, 14 percent average; potatoes, 6 percent planted, 41 percent average; sugar beets, 29 percent planted, 75 percent average.
Winter wheat condition is rated 41 percent good to excellent. Average temperatures are 6 to 15 degrees below normal, but farmers got an average of 4.2 days of fieldwork in before May 18 rain. Topsoil moisture is 68 percent adequate and 31 percent surplus.
- South Dakota: Corn, 73 percent planted, 69 percent five-year average; soybeans, 32 percent planted, 26 percent average; spring wheat, 83 percent planted, 93 percent average; barley, 55 percent planted, 82 percent average; oats, 81 percent planted, 90 percent average. Crop conditions in the good to excellent categories: winter wheat, 59 percent; oats, 76 percent.
Statewide, 4.8 days were suitable for field work. Topsoil moisture is 94 percent adequate or surplus.
- Montana: Corn, 52 percent planted, below the 64 percent five-year average; canola, 70 percent planted, 70 percent average; spring wheat, 74 percent planted, 73 percent average; barley, 88 percent planted, 78 percent average; durum, 49 percent planted, percent average; sugar beets, 98 percent planted, 80 percent average; lentils, 73 percent planted, 81 percent average; dry peas, 83 percent planted, 83 percent average.
Topsoil is rated 87 percent adequate to surplus. There were 5.5 days suitable for fieldwork the week before the report. Much of northeast Montana has had 100 to 130 percent of normal rainfall since April 1. Much of central Montana is running 55 percent to 85 percent of normal rainfall since April 1.