Crop insurance report criticizes federal incentives

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An environmental group has released the data which has indicated FCIP’s structure is flawed.

A report has just been released by the National Resources Defense Council, which has criticized the very structure of the Federal Crop Insurance Program (FCIP), despite the fact that the payments that the program has been making are vital to the financial survival of farmers across the country.

Last year’s drought brought about payments that reached record heights, breaking the $17.3 billion mark.

The National Resources Defense Council report contained the results of a study. It suggested that the structure of the crop insurance program actually provides an incentive for risky farming practices instead of encouraging growers to reduce their risks. It stated that it fails to boost the inclination of farmers to implement strong soil building management practices, such as cover cropping, no till strategies, and efficient management of irrigation. Furthermore, the growers who do not follow those practices don’t receive the actuarial benefits of what they have done.

Crop Insurance programMany of the farmers across the country aren’t convinced that the report is correct about the crop insurance program.

Many of the practices that are recommended by the crop insurance report are those that are highly familiar to the High Plains region, commonly experiences weather extremes and other issues such as drought. However, across the nation, many of the farmers who have read the report aren’t quite convinced that its findings are quite as realistic as it implies.

A Livingston County, Illinois, farmer, named Doug Wilson, for example, received the highest crop insurance payout in the country, last year. He explained that even with all of the practices outlined in the report, it still would have been very difficult to cope with the extreme heat and dryness that were experienced within the areas of his farms. He underscored the point that he was trying to make by paraphrasing former President Eisenhower, saying “it’s a lot easier to farm with a pencil from a thousand miles away than it is to actually have your hand on the plow.”

The NRDC report made a number of recommendations for making reforms to the federal crop insurance program and has suggested launching a new pilot program that would integrate premium reductions for farmers who choose to implement certain risk reduction strategies.

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