Farmers across the country battered by the ongoing drought are relying more and more heavily on federal crop insurance programs. This increased reliance will more than likely play a major role in upcoming farm bill debates.
After several years of major windfalls, the agricultural sector is experiencing one of the worst declines in recent memory. The ongoing drought, which has affected more than two-thirds of the country, is withering crops and weakening livestock nationwide. Some farmers are reporting near total losses of their summer crops and major agricultural states like Iowa have reported that only 15 percent of their corn crop is in good condition.
In times like this, federal crop insurance programs are becoming increasingly important nationwide. Currently, about 84 percent of all eligible farmland is covered by crop insurance, with 1.1 million policies written last year alone. This represents a major increase from 1988 (the last major nationwide drought) when only 18 percent of land was covered.
According to one Iowa farmer, “It has been absolutely essential. In our environment with high priced inputs, high priced land, cash rents, I cannot afford to have a one-year total loss. I borrow money and I leverage myself and I manage those risks by buying crop insurance to ensure that if we do have a catastrophe like we do now I will still receive revenue to carry me into the next year to keep us in business.”
To learn more about agricultural financing opportunities contact a Farm Plus Financial representative by calling 866-929-5585 or by visiting www.farmloans.com.
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Written by: Justin Ellison / Farm Plus Staff Writer