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Cooter

Preventative plant insurance - too good to be true or life saver?

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I have heard rumblings about this from multiple people because of the soggy spring we are having.  I am leery because it sounds like a to-good-to-be-true kind of deal; you get paid to not do nothing.  I feel like there is some kind of catch that I am missing, because there is no free lunch. 

  • If you take the prevent plant are you going to be punished for years to come with extra high premiums or take a major hit on your yield average?  I feel like this is getting a "0" on a final exam in school, despite how well you have done in the past, you're final grade is going to take a severe beating.
  • Is the price per acre payment based on your average yield or projected price per bushel? 
  • If there is a major prevent plant over multiple states and the price of corn rockets up, will your price per acre increase or is it a fixed rate take it or leave it deal? 

I have heard the penalties for trying to slip one under the radar are steep!  Like banishment from crop insurance and any FSA programs for 10 years, so maybe this prevent plant has some legitimacy to it.  I thought it would be nice to use this opportunity to follow some ground, pick rocks, plant a cover to give some tilth back to the soil, and plow in down in the fall, but I'm not sure what to do......

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March 1st is the final crop insurance sign up date we have never taken prevented plant so i can't answer your primary question. 

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You never make any money off of crop ins. The 60% of 75% or whatever prevent land is. You still have to spray the land for weed control and all your machinery expense and Living is still there. If you absolutely can’t get it seeded it might be a life preserver but you are not making any money on it. It isn’t a sit back get rich deal.

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I do know that the cover crop thing can be kinda tricky. Ive heard that the way the rules are written that say you seeded a cover crop last fall. You don't get it killed off this spring because of wet weather and you don't get anything planted. They claim the cover crop as a crop if it goes to seed and you can't get prevent plant. They consider the cover crop a viable crop at that point. 

There were a bunch of rules we have at the computer at home that were sent to dad a couple of weeks ago on prevent planting. I don't have them handy right now as we're trying to plant beans. I know that the yield formula takes into account what the yield average was on what you get planted so it all isn't a big fat 0. But your yield average will take a hit and as we all know the law of averages takes a while to get rid of a low average and if you get nothing planted your average goes to h---.

A bunch of rules were changed on this last farm bill so i don't know a lot of the specifics but have a vague jest of things.

Remember even though crop insurance is federally funded it is operated by private insurers. Think to yourself. When is the last time you got a completely free lunch from any type of insurance? There is a price to be paid somewhere along the line.

 

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Also I don’t think you can make any improvements  picking rock, pushing brush,water ways etc.  

just what I hear around hear 

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I don’t know what the exact figures are for prevent plant but it goes something like this. If you have for instance 133 an acre you get 100 an acre coverage at 75% you get a percentage of the 75 something like 60.that takes you to about 60 an acre for every $ 133 of yield you have. Maybe not quit right but close. The important thing to remember is you aren’t getting rich. Much easier to raise a crop and sell it than use gov money.

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You get 50% of your elected coverage amount(can be more if bought up). So for instance if insured at 80% you would get 50% of the 80%. If you are on enterprise units you must have 20% planted or you get kicked back to optional.(higher premium). Ground must be maintained. Cover crop or sprayed to control weeds..erosion etc. You can do tiling and improvements for drainage(they dont want to have to pay you again another year). It is a complicated system as is all insurance policies and you had to elect the level of coverage by March 15th. A PP claim does not affect your APH. Late planting you lose 1% coverage per day after June 1st(here...different areas- different dates) if you elect to plant still. There is a cut off date where you are no longer covered. If you plant late and come up short on yield-that will affect your APH.

I may not have the numbers exact but will be well versed on them next Monday when i call in some of my corn acres.

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8 hours ago, Cooter said:

If you take the prevent plant are you going to be punished for years to come with extra high premiums or take a major hit on your yield average? 

Prevent plant does not affect your yield average. Premiums are based on spring price of the crop.  Premiums for this year were based on what crop prices were in march or April, I believe. Next years premiums will be based on next years spring price, if price corn goes up then premiums will follow.  

This year the conditions are just right to show that prevent will do better per acre on return than actually growing the crop.  But that can change fairly quickly, if less corn is planted, crop price will go up. Then growing the crop is better. A person needs to sit with their agent and do the math. Every farm situation is different, each farmer has to figure out what is best for them.

i still have no idea which way I want to go!! I am sure Mother Nature will dictate that for me in the next week or so.

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New guy explained it about good as a guy can. I should have read his post before I started typing!

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39 minutes ago, Farmerboy72 said:

New guy explained it about good as a guy can. I should have read his post before I started typing!

I am no expert but i will be hashing it over with my guy next week. If we miss a shower this weekend maybe....big maybe...can plant a few acres on some ridge tops. Side hills and bottoms will be a mess in places. Another farm will be zeroed out this year. Insurance is just a business tool. I would rather plant and harvest but mother nature has been hard on us here the last few years. Drought, drought,and now drown.

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Depending on how soon the flood goes away I may have to use prevented planting. I don't like it but I have to play with the hand I am dealt. Check with your FSA  office too. They have reporting requirements. Thx-Ace

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Best to call your crop insurance agent, talk with them about your options.  If you have never had crop insurance, you are screwed!

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14 hours ago, new guy said:

You get 50% of your elected coverage amount(can be more if bought up). So for instance if insured at 80% you would get 50% of the 80%. If you are on enterprise units you must have 20% planted or you get kicked back to optional.(higher premium). Ground must be maintained. Cover crop or sprayed to control weeds..erosion etc. You can do tiling and improvements for drainage(they dont want to have to pay you again another year). It is a complicated system as is all insurance policies and you had to elect the level of coverage by March 15th. A PP claim does not affect your APH. Late planting you lose 1% coverage per day after June 1st(here...different areas- different dates) if you elect to plant still. There is a cut off date where you are no longer covered. If you plant late and come up short on yield-that will affect your APH.

I may not have the numbers exact but will be well versed on them next Monday when i call in some of my corn acres.

I myself for you guys in the south would plant if you could even if it is late.  Short 73 to 79 day hybrid can yield close to 200 . I have never collected pp but it used to be popular up here in North Dakota. If you had cattle you could pp some acres then seed a feed crop. So all the acres of silage corn or oats millet hay we’re seeded on your highest dollar crop pp acres. You got insurance payment, disaster payment at that time . It was like someone paid you rent then let you farm your land. The rules have changed though now and you can’t do any funny stuff now.

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52 minutes ago, Farmall1066 said:

Best to call your crop insurance agent, talk with them about your options.  If you have never had crop insurance, you are screwed!

X2

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28 minutes ago, dale560 said:

I myself for you guys in the south would plant if you could even if it is late.  Short 73 to 79 day hybrid can yield close to 200 . I have never collected pp but it used to be popular up here in North Dakota. If you had cattle you could pp some acres then seed a feed crop. So all the acres of silage corn or oats millet hay we’re seeded on your highest dollar crop pp acres. You got insurance payment, disaster payment at that time . It was like someone paid you rent then let you farm your land. The rules have changed though now and you can’t do any funny stuff now.

No haying or grazing until after November 1 and can’t harvest to sell as a crop. 

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15 hours ago, Farmerboy72 said:

New guy explained it about good as a guy can. I should have read his post before I started typing!

I think he did just as good as our crop insurance girl!!!

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hello so another question about pp. you lose 1% of your coverage each day. is that recalculated each day on the balance, I asked yesterday agent didn't know, easy to understand that by june 25 we lose 25 % of our coverage, but it could still be insured?  by then we are almost positive it is not going to mature anymore and will be silage corn? yet they will still insure it for dry shell corn? its kind of a safety net for guys with cattle. corn doesn't mature then chop it for silage, the way the hay crop  is around here dairy will use up all this late planted corn, however if I was only growing cash crops no cattle anywhere near and it is early june and you are a month late already I would take prevent plant, around here the corn struggled to get to 20% moisture in the fall if it is a good year. the last time was 2013, we planted everything we had up till 4th of july, the corn only yielded about half of normal yield for silage about 8 to 10 ton per acre and any extras were taken up by neighbors who all were in the same boat. was sold very cheaply at the time as it was just starting to dent,

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There is a late plant date that you must meet.  I believe it's June 15 for us Wisconsin guys.  If you plant after that your crop is not insured.

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Yes after the late plant date you are running naked(uninsured). My buddy is gonna see about planting corn after the PP date and running naked. Chop for silage after Nov 1st date. If we get a late frost it might work here. Might be on the dry side for silage but maybe some inoculant to help it ferment??

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9 hours ago, dale560 said:

I myself for you guys in the south would plant if you could even if it is late.  Short 73 to 79 day hybrid can yield close to 200 . I have never collected pp but it used to be popular up here in North Dakota. If you had cattle you could pp some acres then seed a feed crop. So all the acres of silage corn or oats millet hay we’re seeded on your highest dollar crop pp acres. You got insurance payment, disaster payment at that time . It was like someone paid you rent then let you farm your land. The rules have changed though now and you can’t do any funny stuff now.

I dont know if bringing a short day hybrid this far south would be a good idea. Different disease pressures would be the main thing. Mudding any corn in usually isnt the best option either. The one farm i will get something growing and turn the cows out in November to clean it up. The other farm i may do some fall seeding alfalfa/clover mix on the tougher acres and hopefully the landlord will keep his word and get some ditches cleaned up in the bottoms.

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We will see more PP here in the delta region than ever before. The discussion has started about how its going to effect everyone in the whole scheme of things. Fewer chemicals sold, seed sent back to the warehouse; fewer acres for the consultant to check and airplane guys to spray.

Economic impact cant me measured at this point. 

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On 6/1/2019 at 7:25 PM, Delta88 said:

We will see more PP here in the delta region than ever before. The discussion has started about how its going to effect everyone in the whole scheme of things. Fewer chemicals sold, seed sent back to the warehouse; fewer acres for the consultant to check and airplane guys to spray.

Economic impact cant me measured at this point. 

We were just having that discussion this weekend.  There is no prevent plant insurance for the ancillary industry.  This is going to hurt entire communities on many levels.

 

New Guy - I love the idea of fall seeding alfalfa!  We were saying this could be a good way to get a really nice alfalfa field.  A neighbor needs corn stalks to mix in his feed and we had contemplated seeding some corn mid summer and mowing it down for the stalks.  Unorthodox, but do you think that could work?

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The only reason I buy crop insurance is for the pp coverage. I have around 700 acres in the james river valley in SD. The river has been out of its banks since March 23. When I have pp its field boundaries. I have never needed the insurance for a crop failure, and I have built up an excellent aph so the pp payment is good, avg over 250 for corn and over 200 for beans. Yes I need to control weed growth, but after the inputs are returned, pp gives me a cushion to survive on. I plan on cover cropping anything dry enough to do by mid July. Much will be grazed by our cows/sheep after Nov 1. Have considered giving up the pp to harvest a couple fields for hay earlier than Nov 1. There was talk on news the other night about trying to get rid of the nov 1 date so that livestock producers could salvage some feed instead of sell cows. Obviously, especially with rising corn prices, I'd like to raise corn, but it will take all the unflooded top acres to raise feed for our operation. As long as a person can qualify for enterprise units, the premium is manageable. There will be much pp in my area this year for sure

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4 hours ago, 1958560 said:

The only reason I buy crop insurance is for the pp coverage. I have around 700 acres in the james river valley in SD. The river has been out of its banks since March 23. When I have pp its field boundaries. I have never needed the insurance for a crop failure, and I have built up an excellent aph so the pp payment is good, avg over 250 for corn and over 200 for beans. Yes I need to control weed growth, but after the inputs are returned, pp gives me a cushion to survive on. I plan on cover cropping anything dry enough to do by mid July. Much will be grazed by our cows/sheep after Nov 1. Have considered giving up the pp to harvest a couple fields for hay earlier than Nov 1. There was talk on news the other night about trying to get rid of the nov 1 date so that livestock producers could salvage some feed instead of sell cows. Obviously, especially with rising corn prices, I'd like to raise corn, but it will take all the unflooded top acres to raise feed for our operation. As long as a person can qualify for enterprise units, the premium is manageable. There will be much pp in my area this year for sure

The James river starts about 20miles south of us. The James and Sheyenne are really close in a spot a few miles apart. Our drainage goes in the sheyenne then into the red river and up to Hudson Bay. The James starts between Harvey Nd and Fessenden it gets pretty good sized by Jamestown.

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