This article originally appeared in the Spring 2018 edition of Partners:
The diversity of production agriculture among GreenStone members requires a variety of services and programs designed to meet individual needs for risk management and crop insurance. When it comes to protecting high-value specialty crops, there are only a few options for producers to rely on. The relatively new Whole-Farm Revenue Protection insurance program, brought in with the 2014 Farm Bill, offers protection not usually obtainable for specialty crops.
“Whole Farm is relatively new and not a lot of people understand how to use it,” says GreenStone crop insurance specialist Kylee Zdunic-Rasch. “But on the right crop, with the right management, it can be a great tool to protect a producer’s revenues.”
Whole Farm Revenue Protection covers growers when revenues for a given year fall below the Approved Revenue. Approved Revenue is the lesser of either the five-year average Schedule F tax history or expected revenue for the upcoming crop year. When an insured grower receives less than the five-year average in revenues and has incurred at least 70 percent of the average expenses, a claim can be made. Causes of loss can be due to weather, disease or other unavoidable acts of nature.
Beginning Farmers have the opportunity to utilize only three years of tax history, and there are expanding operation opportunities as well. Growers with less than three commodities can insure up to 75 percent of the approved revenue. Growers with three or more commodities can insure up to 85 percent of the approved revenue. For some growers, Whole Farm Revenue Protection is the only crop insurance they are eligible to purchase.
“For an easy example, a farm with a 75 percent policy with average revenues of $100,000 has a year where they only make $65,000, the Whole Farm policy will pay $10,000 to make them whole at the 75 percent level. If the farm produces three commodities, they can insure to 85 percent,” Kylee says. “While the math may look easy, there are a number of details involved that are best explained by a crop insurance specialist.”
When the 2016 growing season started out too hot and dry and then rolled into too much rain, Bruce Klamer, a celery and onion grower in west Michigan, was glad he had purchased a Whole Farm Revenue Protection policy.
“We used NAP (Noninsured Crop Disaster Assistance Program) in the past – but the one year we needed to use it, it took many trips to the FSA office and nearly three years to never receive any kind of payment. When I had a claim on the Whole Farm policy, I had a check within three days after the insurance adjuster visited the farm.”
Bruce raises approximately 90 acres of celery and 50 acres of onions. He starts the celery in his greenhouses in the spring and then transplants them to his fields in early June. He staggers the plantings to create a 12 week harvesting window.
The labor intensive, high value crop requires a high level of inputs to begin the growing season. Without insurance, any threat of disease or bad weather places the farm at a high financial risk.
“It costs roughly $4,000 an acre to grow celery and another $7,000 to harvest,” Bruce says. “So it takes a lot of yield and a lot of dollars to break even.”
Bruce contracts nearly 90 percent of his crops each year to fresh market wholesalers supplying local stores like Meijer and Kroger, and to Campbells for V-8 juice. Using the contracts generally gives Bruce the potential for reasonable returns, provided the yields are generated and markets are not over supplied. With the Whole Farm Revenue Protection insurance, he has the peace of mind that a majority of his revenue is covered should he experience a bad year.
“We were one of the first ones to use the program when it started in 2014,” Bruce says. “We found it to be a reasonable insurance policy to protect our revenues and simple to use. GreenStone introduced us to the program as an added level of security.”
“Whole farm does not fit every type of farm,” Kylee says. “Farms with consistent revenues year after year are not a good fit. But for some growers, like sweet corn or other specialty crops, who have variances in revenues each year, it is a good option. It is also important to view Whole Farm insurance as part of a long-range plan, not just one year at a time.”
Because Whole Farm Revenue Protection was implemented with the 2014 Farm Bill, it is subsidized by the government to protect farms and eliminate disaster payments.
“I couldn’t believe how simple the program is to use,” Bruce says. “Once I have my Schedule F for the year, I meet with Kylee and within 20 minutes we have all the forms filled out and ready to go.”
Additionally, Bruce shares, having everything at GreenStone makes it even easier. “We have tried to finance locally, but they don’t understand farming like GreenStone. And the nice dividend each year says a lot about them and their concern for farmers.”
GreenStone has over 30 local crop insurance agents throughout Michigan and northeast Wisconsin serving a variety of farming operations. For more information on Whole Farm Revenue Protection or other crop insurance products, call or visit a local GreenStone branch.
The entire Spring issue of Partners can be found here: https://issuu.com/greenstonefcs/docs/gs_partners_springweb/36
The diversity of production agriculture among GreenStone members requires a variety of services and programs designed to meet individual needs for risk management and crop insurance. When it comes to protecting high-value specialty crops, there are only a few options for producers to rely on. The relatively new Whole-Farm Revenue Protection insurance program, brought in with the 2014 Farm Bill, offers protection not usually obtainable for specialty crops.
“Whole Farm is relatively new and not a lot of people understand how to use it,” says GreenStone crop insurance specialist Kylee Zdunic-Rasch. “But on the right crop, with the right management, it can be a great tool to protect a producer’s revenues.”
Whole Farm Revenue Protection covers growers when revenues for a given year fall below the Approved Revenue. Approved Revenue is the lesser of either the five-year average Schedule F tax history or expected revenue for the upcoming crop year. When an insured grower receives less than the five-year average in revenues and has incurred at least 70 percent of the average expenses, a claim can be made. Causes of loss can be due to weather, disease or other unavoidable acts of nature.
Beginning Farmers have the opportunity to utilize only three years of tax history, and there are expanding operation opportunities as well. Growers with less than three commodities can insure up to 75 percent of the approved revenue. Growers with three or more commodities can insure up to 85 percent of the approved revenue. For some growers, Whole Farm Revenue Protection is the only crop insurance they are eligible to purchase.
“For an easy example, a farm with a 75 percent policy with average revenues of $100,000 has a year where they only make $65,000, the Whole Farm policy will pay $10,000 to make them whole at the 75 percent level. If the farm produces three commodities, they can insure to 85 percent,” Kylee says. “While the math may look easy, there are a number of details involved that are best explained by a crop insurance specialist.”
When the 2016 growing season started out too hot and dry and then rolled into too much rain, Bruce Klamer, a celery and onion grower in west Michigan, was glad he had purchased a Whole Farm Revenue Protection policy.
“We used NAP (Noninsured Crop Disaster Assistance Program) in the past – but the one year we needed to use it, it took many trips to the FSA office and nearly three years to never receive any kind of payment. When I had a claim on the Whole Farm policy, I had a check within three days after the insurance adjuster visited the farm.”
Bruce raises approximately 90 acres of celery and 50 acres of onions. He starts the celery in his greenhouses in the spring and then transplants them to his fields in early June. He staggers the plantings to create a 12 week harvesting window.
The labor intensive, high value crop requires a high level of inputs to begin the growing season. Without insurance, any threat of disease or bad weather places the farm at a high financial risk.
“It costs roughly $4,000 an acre to grow celery and another $7,000 to harvest,” Bruce says. “So it takes a lot of yield and a lot of dollars to break even.”
Bruce contracts nearly 90 percent of his crops each year to fresh market wholesalers supplying local stores like Meijer and Kroger, and to Campbells for V-8 juice. Using the contracts generally gives Bruce the potential for reasonable returns, provided the yields are generated and markets are not over supplied. With the Whole Farm Revenue Protection insurance, he has the peace of mind that a majority of his revenue is covered should he experience a bad year.
“We were one of the first ones to use the program when it started in 2014,” Bruce says. “We found it to be a reasonable insurance policy to protect our revenues and simple to use. GreenStone introduced us to the program as an added level of security.”
“Whole farm does not fit every type of farm,” Kylee says. “Farms with consistent revenues year after year are not a good fit. But for some growers, like sweet corn or other specialty crops, who have variances in revenues each year, it is a good option. It is also important to view Whole Farm insurance as part of a long-range plan, not just one year at a time.”
Because Whole Farm Revenue Protection was implemented with the 2014 Farm Bill, it is subsidized by the government to protect farms and eliminate disaster payments.
“I couldn’t believe how simple the program is to use,” Bruce says. “Once I have my Schedule F for the year, I meet with Kylee and within 20 minutes we have all the forms filled out and ready to go.”
Additionally, Bruce shares, having everything at GreenStone makes it even easier. “We have tried to finance locally, but they don’t understand farming like GreenStone. And the nice dividend each year says a lot about them and their concern for farmers.”
GreenStone has over 30 local crop insurance agents throughout Michigan and northeast Wisconsin serving a variety of farming operations. For more information on Whole Farm Revenue Protection or other crop insurance products, call or visit a local GreenStone branch.
The entire Spring issue of Partners can be found here: https://issuu.com/greenstonefcs/docs/gs_partners_springweb/36
