Crop Insurance Indemnities Climb to $12.35 Billion

January 23, 2013 01:29 AM
 

via a special arrangement with Informa Economics, Inc.

Loss ratio now at 1.12 for 2012 crop payouts


NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.


U.S. crop insurance indemnities for 2012 crops hit $12.347 billion as of Jan. 21, continuing to set a record for the level of payouts to farmers under the program, according to Risk Management Agency (RMA) data.

So far, corn and soybeans remain the only commodities where more than $1 billion in indemnities has been paid out at $7.848 billion and $1.618 billion, respectively, with cotton closing in on that mark with $917 million as of Jan. 21. Wheat payouts are at $722 million. Corn indemnities account for nearly 64 percent of the payouts for 2012 crops.

For 2011 crops, corn payouts were $3.223 billion, with soybeans at $2.375 billion, cotton at 41.565 billion and wheat at $1.769 billion.

Only Illinois and Iowa have received more than $1 billion in corn indemnities, with Illinois at $1.643 billion and Iowa at $1.280 billion. Nebraska, however, is close to that mark at $934 million.

Here’s a look at corn and soybean indemnities in key states:

State

Corn
(billion dollars)

Soybeans
(billion dollars)

Illinois

$1.643

$0.148

Indiana

$0.556

$0.090

Iowa

$1.280

$0.202

Kansas

$0.654

$0.194

Minnesota

$0.152

$0.047

Missouri

$0.600

$0.206

Nebraska

$0.934

$0.249

North Dakota

$0.042

$0.033

Ohio

$0.205

$0.046

South Dakota

$0.701

$0.243

TOTAL

$7.848

$1.618

The following table shows the week-over-week change in 2012-crop indemnities:

Crop

Week Ended

Net Acres Insured
(million)

Premiums Paid
(Billion dollars)

Subsidy
(Billion dollars)

Indemnities
(Billion dollars)

Loss Ratio

Corn

01/21/13

81.072

$4.306

$2.674

$7.848

1.82

01/14/13

81.181

$4.314

$2.679

$7.284

1.69

Cotton

01/21/13

11.387

$0.833

$0.552

$0.917

1.10

01/14/13

11.391

$0.833

$0.552

$0.879

1.05

Pasture & Rangeland

01/21/13

48.097

$0.163

$0.088

$0.117

.72

01/14/13

48.102

$0.163

$0.088

$0.111

.68

Peanuts

01/21/13

1.302

$0.086

$0.051

$0.018

.21

01/14/13

1.301

$0.086

$0.051

$0.016

.19

Rice

01/21/13

2.104

$0.055

$0.039

$0.039

.71

01/14/13

2.099

$0.055

$0.039

$0.038

.69

Soybeans

01/21/13

64.953

$2.341

$1.467

$1.618

.69

01/14/13

65.014

$2.343

$1.468

$1.503

.64

Wheat

01/21/13

46.336

$1.781

$1.109

$0.722

.41

01/14/13

46.374

$1.782

$1.110

$0.719

.40

TOTAL

01/21/13

281.718

$11.050

$6.937

$12.347

1.12

01/14/13

281.990

$11.063

$6.945

$11.581

1.05


Comments: Crop insurance indemnities continue to rise and push the program payouts beyond the level of premiums paid in. But even when 2011 crop indemnities at $10.839 billion – the prior record payout mark – the program loss ratio stood at 0.91 and has not been above 1.0 since 2002 when the loss ratio rose to 1.39. 


 

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.


 


 

 

 

 

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