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Commodity Communicator Weekly

April 4, 2014

Sens. Jeanne Shaheen (D-N.H.) and Tom Coburn (R-Okla.) introduced legislation that would cap federal crop insurance premiums at $70,000 per farm each year. Presumably this legislation would save about $1 billion over 10 years. The Senators say that this limit would impact less than 1.3 percent of producers, according to a 2011 General Accounting Office (GAO) report.

Following are talking points to use in asking your Senators not to cosponsor or support this legislation.

•    As Congress has transitioned away from traditional price and income support programs – thus saving taxpayer dollars – it has committed to providing farmers and ranchers with the tools to manage the unique weather and market risks they face. Crop insurance is now the most important tool producers have to deal with these risks, and because of its design, it helps shift risk away from taxpayers to farmers and crop insurance companies.
•    Capping premium support is contrary to the fundamental principles of crop insurance, which include encouraging program participation by providing the same premium support percentage to all producers regardless of their location, crops produced, sizes or financial condition of their farming operations.
•    USDA has called a cap on premium support “ill advised,” noting regions with large-acreage farms, high-value crops and a higher risk of crop loss would be especially hard hit. North Dakota, South Dakota, Texas, Minnesota, California, Arizona, Mississippi, Utah and Hawaii have all been singled out by USDA as receiving disproportionate effects under a cap on premium support.
•    GAO analysis shows that capping support will lead to extremely large increases in premium costs for affected producers. Their study of a $40,000 support cap showed that the affected producers received 33% of premium support and had 26% of total insured liability in the crop insurance program in 2011. Thus, such a cap would affect a very large portion of crop production. o
•    Crop insurance participation and coverage would decline as a result of the dramatic increase in premium costs on a large portion of crop production. The significant loss of crop insurance participation and coverage would reduce the level of protection afforded the U.S. food, feed, fiber and energy production. The effects would disproportionately affect high value crops, farms in areas where large acreages are common, and high production risk areas.
•    An inability to manage agricultural disasters through crop insurance would create dependency upon ad hoc disaster legislation. Uncertain, inadequate, and untimely ad hoc disaster would increase farm financial stress, disrupt rural agribusiness operations, and undermine the fabric of rural economies. Crop insurance has been proven too successful to return to failed agricultural policies of the past.


Undersecretary for USDA's Marketing and Regulatory Programs Edward Avalos announced today that USDA is kicking off a national effort to reduce the devastating damage caused by feral, or free ranging, swine. The $20 million program aims to help states deal with a rapidly expanding population of invasive wild swine that causes $1.5 billion in annual damage and control costs.

"Feral swine are one of the most destructive invaders a state can have," said Undersecretary Avalos. "They have expanded their range from 17 to 39 states in the last 30 years and cause damage to crops, kill young livestock, destroy property, harm natural resources, and carry diseases that threaten other animals as well as people and water supplies. It’s critical that we act now to begin appropriate management of this costly problem."

The Wildlife Services (WS) program of USDA's Animal and Plant Health Inspection Service (APHIS) will lead the effort, tailoring activities to each state's circumstance and working closely with other Federal, State, Tribal, and local entities. WS will work directly with states to control populations, test animals for diseases, and research better methods of managing feral swine damage. A key part of the national program will include surveillance and disease monitoring to protect the health of our domestic swine

APRIL SUPPLY/DEMAND REPORT WEBINAR. . . . .Wednesday, April 9 at 12:30 p.m.
The USDA will release its new U.S. and Global Agriculture Situation and Outlook tomorrow.  Join Matt King, Farm Bureau Economist and Scott Stiles, UAEX Economist who will break down the report and give insight into how the report will affect the markets.  

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TWO MORE COUNTRIES LIFT BSE-RELATED BANS ON U.S. BEEF. . . . .Two trading partners agreed to resume imports of U.S. beef for the first time since December 2003. Ecuador and Sri Lanka were among a handful of nations that had never reopened after the first U.S. case of BSE, but both are now accepting U.S. beef.  Ecuador offers strong potential for U.S. beef offal sales.

FARM BUREAU VEHICLE PURCHASE PROGRAM. . . . . Members now have a better way to buy a new or used vehicle through this easy to use program.  Benefits include in-depth price reports, target prices, estimated values and certified dealers.  The $500 GM incentive for members is already built into the system for qualifying vehicles.  Complete details at

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