Crop insurance negotiations
Farm and Ranch February 16, 2010 The USDA’s Risk Management Agency is in the process of renegotiating a new Standard Reinsurance Agreement between the Federal Crop Insurance Corporation and the crop insurance companies, which deliver the insurance programs. The 2008 Farm Bill authorized the renegotiation. Development of a new SRA as it is called was a topic at the winter meeting of the Domestic and Trade Policy Committee of the National Association of Wheat Growers. Committee Chairman Jeff Newtson of Oregon explains what one of the major issues is. Newtson: “The big concern is that over the last several years the high commodity prices being reflected in the CRC in crop insurance, that you are seeing some very high gains pushed into the crop insurance industry. So budget watchers are seeing this and wanting to make sure profits aren‘t exorbitant and right now some of the profits are really high. But as many of you know wheat prices will be going down here in the next couple of years so some of the profits should be coming back down quite a bit.” Newtson says if there are going to be budget cuts in crop insurance wheat growers can’t afford to take any direct reductions as premiums are already pretty high, especially in the higher insurance coverage levels. I’m Bob Hoff and that’s the Northwest Farm and Ranch Report on the Northwest Ag Information Network. ? ?
