Could Crop Insurance Subsidies Be at Risk in 2015?

February 5, 2015 04:15 PM
Could Crop Insurance Subsidies Be at Risk in 2015?

“This is probably the most challenging year for crop insurance in a very long time,” warned Mary Kay Thatcher of the American Farm Bureau Federation

Farmers already concerned about the grain markets and the market price for crop insurance need to add a new worry to their lists in 2015: federal support for crop insurance.

“This is probably the most challenging year for crop insurance in a very long time,” warned Mary Kay Thatcher of the American Farm Bureau Federation. Thatcher, the organization’s senior director for Congressional relations, gave her remarks Thursday at the Crop Insurance and Reinsurance Bureau’s annual meeting in Florida.

What makes this year so tough? Politics and money. There’s a new set of legislators in Congress, and they want to cut costs. Lawmakers from suburban and urban districts don’t necessarily understand the rural economy and the impact of commodity markets and weather events on farmers.

Compromise and bipartisanship--which has always been critical to the passage of farm bills in the past—continues to erode.  “We are at the point where we have redistricted so many times that we have very few districts up for grabs anymore,” Thatcher explained. “They are either a totally Republican district or a totally Democratic district.”

That’s worrisome because lawmakers in the new Congress have already started making noise about saving money by breaking apart the various pieces of the farm bill—commodity programs, subsidies for crop insurance subsidies, conservation, and the Supplemental Nutrition Assistance Program (SNAP) also known as food stamps.

“How in the world would we ever pass another farm bill through the House of Representatives if that happened?” asked Thatcher.

She noted that separating these programs could also expose crop insurance subsidies to criticism and cuts, perhaps sooner rather than later.  “Crop insurance is a big chunk of the farm bill if you remove nutrition,” warned Thatcher, who noted that premium subsidies have been immune from cuts since 1980.

That could change soon as legislators look for savings wherever they can. “Farmers are going to be the ones looked at for cuts this year,” she predicted. 

The possibility worries her, given the current state of commodity prices and the fragile financial state of many smaller producers. "We have so much ending stocks in the world," she says. "There is no way the price [for grain] can go up. It has to go down."

Click here for live coverage of the CIRB meeting via Twitter.

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Spell Check

enderlin, ND
2/9/2015 08:31 PM

  welfare trash ? lets give credit where credit is due. First off the farmers share of crop insurance is so high it is debateable if a person should take it. the one's who receive the "BIG" farm subsidies are the agents/insurance companies. and i don't want to leave out anyone in big cities who has kids in school that eat hot lunch they are recipients of "THE FARM BILL" and don't even know it. It seems to me every one get's a hand out from the farm bill in some way big or small.not just gain farmers!!!

hendrum, MN
2/9/2015 09:58 PM

  Think crop ins. premiums are high? Take a look at what they would be without government subsidy. Take that to the bank and see how willing they are to lend on an uninsured crop.

Lubbock, TX
2/9/2015 11:12 PM

  I find it hypocritical that farm producers should call anybody welfare trash. Enjoy the full benefits and pitfalls of free market capitalism and get off the dole. Then you can preach to others. SNAP benefits farmers as well as needy families, but many of you are too politically blind to see the connection. You want YOUR dole money but don't want others to have any. If you make this a war of urban vs. rural, you will lose the fight.


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