2011 Organic Commodity Insurance
In 2011, for the first time, USDA is offering crop insurance for corn, soybean, cotton and processing tomato farmers that recognizes the organic price in its coverage. This is not a new crop insurance policy. It adds the organic price option to existing production and revenue coverage.
In the event of a loss, organic farmers with this coverage will receive benefits calculated based on the wholesale organic rather than the conventional price, coming closer to addressing their true losses.
This is an important step by USDA, and may provide an important risk management tool for organic producers. The deadline for applying for the coverage is February 28, 2011. Read the USDA press release.
Help RAFI-USA Test New Organic Crop Insurance
RAFI-USA is looking for producers of organic corn, cotton, soybeans or processing tomatoes who are willing to evaluate crop insurance with the new organic price election for their farms, and to fill out a short on-line survey on their experience. This information is critical for us to advocate for changes to the program to make crop insurance and all of USDA work more effectively for organic producers.
If you are farmer who grows organic corn, cotton, soybeans or processing tomatoes, sign up here, and we'll send you a short online survey soon. Please note that we are asking farmers to evaluate this program for themselves and let us know what they think. Whether or not you purchase the coverage is completely up to you, and we want to hear about your experience whether you purchase the policy or not.
Because this price election is new, many crop insurance salesmen are not aware that it is available, and organic farmers may need to assist their salesmen in finding out about the price election.
What you can do:
- Sign up to be a part of the survey.
- Call your local crop insurance salesman to evaluate whether or not the policy is right for you. A crop insurance agent locator is available on the U.S.D.A. Risk Management Agency web site at www.rma.usda.gov.
- Fill out our 15-minute online survey on your experience.
If you have any questions or comments, please do not hesitate to contact us at (919) 542-1396 x210, or email Scott Marlow at smarlow@rafiusa.org or Carmen Moa-Rivera at (919) 542-1396 x202 or carmen@rafiusa.org.
Frequently Asked Questions about Crop Insurance with the Organic Price
Farmers are strongly encouraged to talk through their crop insurance options with their crop insurance agent. To locate an agent near you, go the USDA Risk Management Agency Agent / Company Locator.
How is the price determined?
The organic price is determined by the average daily closing price on the Chicago Board of Trade during the discovery period. For North Carolina, the 2011 discovery period is from January 15 until February 14, and can be found on the Risk Management Agency web site. For revenue coverage, the price is determined by the average daily closing price on the Chicago Board of Trade during the discovery period. For North Carolina, the 2011 discovery period is from September 1 until September 30. Prices are released within three business days after the end of the discovery period.
Will the insurance cost more?
Any time coverage is increased, the cost of the coverage increases as well, so coverage with the higher organic price will cost more than coverage at the conventional price. However, farmers have the option of reducing the rates of coverage to reduce their costs.
Do I have to take the organic price?
Farmers who are producing organic crops will need to receive the organic coverage. However, if that coverage is more costly than the farmer wants to pay, they can reduce the level of percentage of coverage in the policy to reduce the price.
Does it cover the direct market organic price?
No. The price that the crop insurance is based on is the Chicago Board of Trade (CBOT) price, not a direct market price. Farmers who receive a direct market price are encouraged to look at Adjusted Gross Revenue and Adjusted Gross Revenue – Lite crop insurance policies.
What types of crop insurance have the organic price election?
Available policies include revenue protection, revenue protection with harvest price exclusion, and yield protection.
For more information, please contact your Crop Insurance Agent, or contact Scott Marlow (smarlow@rafiusa.org) or Carmen Moa-Rivera (Carmen@rafiusa.org) or call Carmen at (919) 542-1396 x202.
Page Updated 01.19.10