The federal government has long been
involved in providing insurance to
farmers to help them when Mother
Nature doesn’t cooperate.
For example, in June the insurance
program for sunflower farmers was
expanded by the federal Risk Management
Agency to include guarantees for both
seed yields and prices, the latter being
particularly relevant because prices have
fallen considerably in the past year. The
other half of the story is that prices
spiked in 2007 and 2008, rising to about
$22 per hundred pounds, and remained
above average over the past decade,
according to data from the U.S.
Department of Agriculture. All of this
bodes well for growers in North Dakota,
the nation’s leader in sunflower production.
State farmers are also hoping for better
policies for hay and rangeland. The current
program for forage insurance
began in 2007 to help livestock farmers
deal with drought. It uses either a rainfall
or vegetation index—but not
both—to determine when losses occur.
North Dakota uses a rainfall index, and
the state’s ag secretary petitioned the
RMA to give farmers there access to the
vegetation index as well because the
state has a limited number of rainfall
reporting stations, which can skew local
rainfall results—hypothetically, at least.
According to an Associated Press
report, the program paid out on 85 percent
of policies in its first two years without
the vegetation index.