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Quality Issues Raise Crop Insurance Questions

Producers in some areas have experienced a perfect storm in weather in 2018. After a delayed growing season, crops caught up and matured ahead of normal, only to have rain delay harvest. That opened the door to quality problems ranging from soybean pod shattering to mycotoxin contamination.

In fact, USDA’s Crop Progress report this week shows harvest in the 18 states behind average for all crops, and Kansas is among those with crops still in the field:

Corn remaining (%)

 

Corn
5-year average remaining
Soybeans remaining (%) Soybeans
5-year average remaining
Sorghum remaining (%) Sorghum 5-year average remaining Sunflower remaining (%) Sunflower 5-year average remaining
Kansas 11 5 26 10 38 20 37 8
Reporting states  

16

 

13

 

12

 

7

 

27

 

16

 

39

 

25

 

More than a quarter of the beans in Kansas are still in the field, according to USDA’s count. “We were hearing reports of quality problems,” said Ruth Compton, crop insurance officer in Hiawatha. “I don’t believe it’s been a huge problem but with a lot of soybeans still in the field, there is a continued concern.”

Different situations

The crop insurance claim process differs depending on the situation. For instance, if a field is flooded and has standing water, you are not allowed to harvest for food use. You have the option to sell to a salvage buyer if you can find one who will take your production or you can destroy the crop and take a zero on your Actual Production History (APH). If you have a quality issue that your elevator discounts less than 8 percent, it doesn’t support a claim.

And, although the price drop from the spring guarantee of $10.16 to the harvest price of $8.61 appears large, in almost all cases, it would not produce a claim on its own, depending on the yield. The table below illustrates the yield needed to trigger a claim given various revenue guarantees. The October average falls between the $8.65 and $8.66 rows in the table.

revenue guarantee table

revenue guarantee table

In all cases, you need to weigh the impact on APH against the amount a claim might be worth. Your Frontier Farm Credit insurance offer can help identify the avenues you can use to ensure the impact on your APH is minimized.

A bigger question this year may be the effect on your Market Facilitation Program (MFP) payment. That is paid strictly on the bushels produced. The first of two possible payments is $1.65 on half your production. So the question is: Is it better to combine the crop to collect the 82 cents, plus a likely additional payment, or save the cost of combining and file a claim?

Your Frontier Farm Credit insurance team can help you make that determination – and guide you through the claims process when quality is at issue.

For those who want to review before proceeding, click to view the USDA/Risk Management Agency fact sheet on Soybean Kernel Damage Quality Adjustment Procedure.

Winter wheat

Winter wheat planting also is a bit behind average, with 90 percent completed in Kansas, 8 points behind usual. 77 percent has emerged, well behind the 89 percent average. As of Nov. 11, USDA rates 44 percent of the crop good/excellent, compared with 54 percent in the 18 reporting states. Fourteen percent is poor/very poor in Kansas while 12 percent falls in those categories in the 18 states, headed up by Oklahoma, Oregon and Texas.

Image: Purple seed staining of soybean in south central Nebraska. Photo courtesy of Jennifer Rees, UNL CropWatch

Corn now a week ahead; soybeans slightly less advanced

Corn harvest jumped 10 points to 26 percent in the final week of September. This is well ahead of the 17 percent average for the 18 reporting states. Eighty six percent of the crop is mature, 15 points ahead of average, so combines will continue roll, weather permitting.

Harvest in our territory also continues to run ahead of average, despite a lack of suitable field days in many areas.

State Percent Harvested 9/23 9/30 Average
Iowa 5 11 6
Kansas 30 47 39
Nebraska 43 65 42
South Dakota 5 11 7

 

Soybean harvest also advanced, reaching 23 percent complete in the 18 states. That is up 9 percentage points from the prior week and three ahead of average.

With 83 percent of beans dropping leaves (average, 75 percent), condition is rated unchanged at 68 percent good/excellent and 10 percent poor/very poor. Kansas and South Dakota have 58 percent in the top categories, Iowa 74 percent and Nebraska 85 percent.

Grain sorghum is running slightly behind average, with 34 percent harvested in the 11 reporting states (average is 36 percent); 62 percent mature (63 percent average) and 97 percent (2 points ahead of the 95 percent average). Its condition worsened one point at each end, with 54 percent good/average and 17 percent poor/very poor.

Winter wheat planting also jumped in the past week, from 28 percent complete to 43 percent, which is three points ahead of average. Progress in our states varies somewhat, with Nebraska slightly behind average:

State 9/23 Average
Kansas 41 32
Nebraska 72 74
South Dakota 67 65

 

Pasture and range conditions continue to improve, with 42 percent now rated good/excellent and 23 percent poor/very poor. Kansas is rated 53 percent good/excellent and 19 percent in the bottom categories.

Soil moisture in South Dakota continues to be short in some parts of the state:

  Very short Short Adequate Surplus
Topsoil moisture 8 20 65 7
Subsoil moisture 14 29 53 4

 

These two maps tell the story.

palmer drought index - Sept 2018

 

drought map 9-25-2018

Ripening corn

Combines – and planters – rolling

A string of clear weather days jump-started harvest. In the 18 reporting states, 16 percent of corn and 14 percent of soybeans are combined, compared to 11 percent and 8 percent on average.

All of the states in our service area are ahead of average in development and harvest:

Corn dented Corn mature Corn harvested
Sept 24 Average Sept 24 Average Sept 24 Average
Iowa 97 94 74 51 5 3
Kansas 98 96 80 69 30 27
Nebraska 98 96 69 53 9 6
South Dakota 98 92 67 43 5 3
18 States 97 93 72 53 16 11

 

Corn condition continues favorable, with the 18-state rating improving one point in the top categories to 69 percent and the bottom two unchanged at 12 percent. The rain was too late to boost the Kansas crop into better-than-half good/excellent; it stands are 47 percent, while 26 percent falls in the bottom categories. South Dakota is slightly below average, at 63 percent good/excellent and 18 percent poor/very poor. Both Iowa and Nebraska are above average.

Soybean progress and harvest also are ahead of average, by a wide margin in some states.

Dropping leaves Harvested Condition
Sept 24 Average Sept 24 Average Good/excellent Poor/very poor
Iowa 72 49 8 3 22 7
Kansas 49 43 2 2 60 10
Nebraska 84 69 13 6 83 6
South Dakota 83 74 12 6 61 15
18 States 71 57 14 8 68 10

 

Grain sorghum’s progress is closer to average, and more of a mixed bag, with several measures behind average.

Coloring Mature Harvested
Sept 24 Average Sept 24 Average Sept 24 Average
Kansas 93 90 32 33 6 6
Nebraska 95 97 48 41 6 4
South Dakota 85 90 24 35 1 4
18 States 94 90 50 53 30 32

 

Condition is better than average in our service area. Nebraska is rated 84 percent good/excellent and 2 percent poor/very poor compared to the 11-state average of 55 percent and 2 percent; Kansas is 71 percent and 7 percent; and South Dakota, 67 percent and 5 percent.

Winter wheat planting

Even as corn and soybeans are coming out of the field, 28 percent of the winter wheat crop is planted, two points ahead of average. Kansas farmers have 21 percent in, compared with 16 on average; Nebraska is three points behind average at 53 percent; and South Dakota is six points ahead of average at 53 percent.

Rains have helped Kansas pasture and range condition, which has reached 50 percent good/excellent. That compares with only 29 percent at the start of August. However, 17 percent remains in poor or very poor condition.

Steady as she goes

Crops are marching their way to the finish line with promise of a touchdown. As of September 2, status in the reporting states was:

Corn dough stage: 96 percent, average 91 percent

Corn dented: 75 percent, average 60 percent

Corn mature: 22 percent, average 11 percent

Soybeans dropping leaves: 16 percent, average 9 percent

Sorghum headed: 96 percent, average 95 percent

Sorghum coloring: 69 percent, average 62 percent

Sorghum mature: 30 percent, average 33 percent

Sorghum harvested: 22 percent, average 23 percent

Spring wheat harvested:  87 percent, average 75 percent

 

Condition is little changed from a week ago and overall continues better than last year.

Corn is rated 87 percent good/excellent and 12 percent poor/very poor, 1 point lower on the high end than a week ago and 6 points better than a year ago.

Soybeans are unchanged from last week, with 66 percent in the top categories and 11 percent in the bottom two. This compared with the same number in the bottom categories and 5 percent more in the top categories than last year.

Sorghum, at 52 percent good/excellent in the 11 states, is 1 point below last week, but 11 points behind last year. Its bottom two categories, at 17 percent, compares with just 8 percent last year. Texas and Missouri represent the highest numbers in the bottom categories.

The table includes a few surrounding states:

Corn Soybeans Sorghum

Good/excellent

Poor/very poor

Good/excellent

Poor/very poor

Good/excellent

Poor/very poor

Iowa

74

8

72

8

NA

NA

Kansas

44

28

49

15

66

8

Nebraska

81

6

81

6

84

1

South Dakota

65

14

57

20

65

5

 

Recent rains helped pasture condition improve a couple points at each end in the 48 states. Drought-stressed Kansas now has 27 percent in the bottom two categories and 38 percent in the top two. This compares with 25 percent in the bottom and 34 in the top two months ago (July 2). The first report in May showed 29 percent in the bottom categories and 25 in the top two.

pasture and crop condition for Kansas

 

Corn field and stormy sky

Condition Inches Downward; Reports Not All Rosy

At the start of the week of the annual Pro Farmer Crop Tour, USDA trimmed corn condition a few points. Sixty-eight percent of the crop is in good/excellent shape, down from 70 percent the prior week. The bottom end of the ratings crept up two points to 12 percent. Soybean condition also worsened slightly with the top end down one point to 65 percent and the bottom end at 11 percent.

Corn denting is well above its 26 percent average at 44 percent. In the states we serve, Iowa is at 42 percent (average 21); Kansas, 58 (36); Nebraska, 38 (25) and South Dakota, 38 (12).

Soybean pod setting also is ahead of average at 91 percent in the 18 states against an average of 83 percent. Iowa farmers reported 93 percent (85 percent average); Kansas, 82 (67); Nebraska, 92 (88) and South Dakota, 91 (85).

Crop Tour

Pro Farmer midwest crop tourThe annual Pro Farmer Crop Tour kicked off and the day one results were startling: A 100-bu./acre range of estimates. More than 100 scouts took to the roads in Nebraska, South Dakota and Ohio. The western group suffered downpours – rather unusual for the tour.

Jeff Wilson, leading the tour for the first time this year, was among those taking field measurements in southeastern South Dakota. Estimates ranged from 153 to 248 bu./acre, averaging 185 bu. – a little higher than the 170 bu. estimate from USDA last week.

Tour members traveling in northeast Nebraska reported 192 bu./acre dryland east of Norfolk, 196 bu./acre east of Columbus, and 200-plus in Antelope County. In other parts of Nebraska, there were reports of hail, flooding and delayed development, disease pressure and irregular fertilization and fill. Follow the tour on Twitter: #PFtour18.

Grain sorghum

Little change was reported in the sorghum crop, with one more percentage point falling from fair to poor, putting the poor/very poor score at 18 and good/excellent steady at 49 percent in the 11 states. Forty-six percent of the crop is coloring with 23 percent mature, compared with 43 percent and 27 percent respectively.

Wheats

Harvest of winter wheat is 97 percent complete, one point behind average while 60 percent of spring wheat has been harvested, versus 44 percent on average.

Spring condition held steady at the lower end of the range but lost one point at the upper end.