At the recent National Peanut Buying Points Association annual convention, Keith Schumann, AgriLogic Consulting, LLC, spoke about the new insurance program available beginning with the 2015 peanut crop.
As with the previous policy, producers can elect to use their contract prices for the insurance price election in the yield protection policy. If the contract price is used, the price will be a weighted to the average projected price.
If no contract is used, insurance program peanut prices will be determined using a formula that relates shelled peanut prices to prices of the following: December wheat, cotton, soybean oil and soybean meal contracts and other factors. Also considered is price of shelled peanuts to that of in-shells using the loan rate and National Ag Statistic Service survey prices. All these factors will be developed into a formula to determine the price for the four peanut types.
Projected prices will be determined in the spring prior to planting and harvest prices will be determined in the late fall. Peanut producers who elected one of the revenue insurance options may receive an insurance payment if the combination of price losses calculated by the program’s methodology and/or yield losses experienced by the grower’s operation, results in financial losses in excess of the deductible on their insurance policy.
Options And Deadlines
Other program points are that a grower can opt to insure on an “enterprise unit” resulting in lower premiums by almost half. If an insured grower has to replant, there is a fixed value of $95 per acre, which is up $15. A quality adjustment will start after 10 percent of the value has been lost as a result of quality problems.
Peanut types include: Runner, Southeast and Southwest Spanish, Valencia and Virginia. Practices include irrigated or non-irrigated; spring, fall or not-specific; conventional or organic. Coverage levels will be 50 percent to 80 percent in five percent increments.
Sales close for most peanut states is Feb. 28, 2015, with others being March 15. To find out the deadline for your state and other program details, contact your local crop insurance agent. To find an agent, go to www3.rma.usda.gov/apps/agent.