March 8, 2010

CROP  INSURANCE  DEADLINE  ON  MARCH 15
March 15th is the deadline to purchase crop insurance for the 2010 crop year. Producers need to analyze how crop insurance fits into their risk management and grain marketing strategies for the coming year. Farm operators are encouraged to discuss 2010 crop insurance needs and options with their crop insurance agent before the March 15 deadline.

Bottom Line On Crop Insurance Decisions :

• View crop insurance decisions from a risk management perspective.

How much financial risk can you handle if there are greatly reduced crop yields due to weather problems and/ or lower than expected crop prices ?

• Take the time to verify yields and keep good yield records from year to year.

You can greatly enhance your insurance protection with APH or CRC and RA-HP options at little or no extra cost by doing a good job of maintaining the maximum APH on farm units.

• There are a wide variety of crop insurance policies and coverage levels available.

Make sure you are comparing “apples to apples” when comparing crop insurance premium costs for various options or types of crop insurance policies, and recognize the limitations of the various crop insurance products.

• Take a good look at the 80% and 85% coverage levels, especially if you are using “enterprise units” or GRIP insurance policies.

You will be surprised how much additional protection can be added at these higher coverage levels for a modest increase in premium costs. Many producers will be able to guarantee over $550.00 per acre for corn and over $350.00 per acre for soybeans.

• Give consideration to “Enterprise Units”, GRIP or GRIP-HP policies for 2010.

“Enterprise Units” and GRIP policies become quite attractive due to significantly lower premium costs, compared to “optional units” for CRC or RA-HP policies. However, consideration must be given to the fact that “Enterprise Units” and GRIP policies are based on larger coverage areas, and do not  necessarily cover losses from isolated storms or crop damage that affect individual farm units.

• Investigate the potential of the BYE Endorsement on eligible corn acres.

There will likely be significant premium savings with the BYE Endorsement on corn acres in 2010; however, producers should  find out all details of BYE prior to sign-up, and remember to follow the compliance regulations for the BYE Endorsement.

• The ACRE and SURE farm programs do not replace good crop insurance coverage.

Make crop insurance decisions based on the risk management needs of the farm business, and recognize that the ACRE and SURE programs do not offer the same level of risk management, and should be treated independently of crop insurance decisions.

• Where to get more information on 2010 Crop Insurance alternatives.

A reputable crop insurance agent is the best source of information to find out more details of the various coverage plans, to get premium quotes, and to help finalize 2010 Crop Insurance decisions.

• Following are some very good web sites with crop insurance information :

           >  University of Illinois FarmDoc :   http://www.farmdoc.uiuc.edu/
           >  Iowa State Univ. Ag Decision Maker :    http://www.extension.iastate.edu/agdm/
           >  USDA Risk Management Agency (RMA) :    http://www.rma.usda.gov/

VINCENT  TO  SPEAK  ON  MARCH 15
The Blue Earth County Corn and Soybean Growers Associations have scheduled their 2010 Annual Meeting for Monday, March 15, at 6:00 PM, at the Community Center in Pemberton, MN. The Annual Meeting will include a social hour at 6:00 PM, a meal at 6:30 PM, followed by a presentation by Bruce Vincent, nationally recognized speaker Bruce Vincent, from Libby, Montana. He will speak on environmental stewardship, conservation, and family commitment by farm families and rural communities, sharing many experiences from growing up in a Montana logging family. He will discuss many of the public misconceptions that exist regarding environmental issues, and how farmers and others that rely on the soil, water and clean air are the in the best position to protect these natural resources for the future.

The Annual Meeting is open to all corn and soybean producers, and anyone else interested in the presentation by Bruce Vincent. The meeting is being sponsored by the Blue Earth County Corn and Soybean Growers Assn., and several area businesses. Anyone planning to attend the Annual Meeting is asked to RSVP to  Earl Ziegler at (507) 278-3770 or eziggy@myclearwave.net; or Brad Loeffler at (507) 257-2030 or loeffler@directv.net

“NEW  TOOLS  FOR  NEW  RULES”
The South Central College (SCC) Farm Business Management Program is hosting their second annual Agricultural Symposium, titled “New Tools For New Rules”. The Ag Symposium will be held on Tuesday March 23, from 9:00 AM to 4:00 PM, at the SCC Conference Center in North Mankato, MN. The agenda will focus on helping today’s agricultural producer adjust to the ever-changing business environment in farming. Three nationally known speakers will highlight the Symposium, including Dr. David Kohl, Professor Emeritus in Agricultural Economics at Virginia Tech University; Dr. Danny Klinefelter, Professor and Extension Economist at Texas A & M University; and Joe Kluender, Certified Ag Consultant with the LarsonAllen accounting firm in Mankato, MN.

Registration for the SCC Ag Symposium is $99.00 per person, which includes the noon lunch and handout materials. Advance registration is requested. To register for the Symposium, with payment by credit card, contact Lori Brendenmuehl at (507) 332-5838, or go to the following web site :  www.southcentral.edu/foundation/mankato, and click on “Ag Symposium 2010”.

**********************************************************************************
Note --- For additional information contact Kent Thiesse, Farm Management Analyst and
              Vice President, MinnStar Bank, Lake Crystal, MN. (Phone --- (507) 381-7960) ; 
              E-mail -- kent.thiesse@minnstarbank.com)  Web Site -- http://www.minnstarbank.com

March 1, 2010

NAIS  DECISION  VIEWED  DIFFERENTLY
When USDA announced in February that it was discontinuing the current National Animal Identification System (NAIS), it was celebrated by many agriculture groups and others that have opposed NAIS for several years. The opponents of NAIS felt that implementation was too expensive for farmers and ranchers, especially cattle producers. They also felt that it was too difficult to implement efficiently by the Federal government, feeling that State implementation is more appropriate. However, some producer groups and others are now questioning the USDA decision to drop the NAIS program, which had been worked on for nearly a decade, and are concerned whether future animal identification (ID) programs can accomplish the same objectives.

In the announcement by USDA to drop the NAIS program, they announced four revisions that will be put in place to replace NAIS :

• Federal animal ID rules will apply only to animal moving across State lines.
• Animal ID programs will be administered by States and Tribal Nations to allow more flexibility in ID programs.
• The revised ID program will allow the use of lower cost ID technologies, such as freeze brands and hot brands. (NAIS called for traceable computer ID tags.)
• Future ID systems will implemented transparently through Federal rulemaking.

The next step will be for USDA to convene a Forum on the implementation of the revised national animal ID system, which will rely heavily on implementation by the States. Many States have greatly “ramped-up” animal ID efforts in the past few years, in response to the Federal NAIS program. States have long been responsible for identifying and tracking animals within their own borders. Many States have done an excellent job of implementing these systems with very good results. An example is the excellent efforts in Minnesota to track the outbreak of bovine tuberculosis (TB) a couple years ago, and to work within the State and with neighboring States to control the spread of the disease. The key in the future will be for all States to have solid animal I.D. programs, and the willingness to share that data with other States, and with the Federal Government.

The National Pork Producers Council (NPPC) had endorsed and supported the NAIS program in the past, feeling it was a positive step strengthening consumer confidence in the U.S., as well as toward solidifying our meat export markets. The NPPC has encouraged pork producers to voluntarily register the premise I.D. for their hog operation with USDA. According to USDA data, about 90 percent of hog farms were identified under this voluntary approach. A majority of pork producers have also participated in the voluntary Pork Quality Assurance (PQA) Program, sponsored by the NPPC through their various State organizations.

Many world trade experts are concerned that the discontinuation of the NAIS program may cause some of the U.S. trade customers to lose confidence in meat and dairy exports from the U.S. Today, approximately 25 percent of U.S. pork, 10 percent of U.S. beef, and 10 percent of U.S. milk solids are exported to other countries. In 2009, we saw how volatile export markets can be, when almost overnight, pork exports dropped dramatically as a result of the H1N1 outbreak in the U.S., even though it had nothing to do with the pork products being exported. Supporters of the NAIS program are concerned whether a revised State-managed animal ID program will allow the Federal Government to react quickly enough in the event of future events that may involve animal disease outbreaks, which could have serious economic implications on the U.S. livestock industry.

CHECK  GRAIN  BINS
A reminder to farm operators to check grain bins for potential storage problems. There have been several reports in recent weeks of corn and soybeans in on-farm storage going out of condition, leading to spoilage, molds, and potential large price discounts when the grain is sold. Much of the corn and soybeans in 2009 were harvested at less than ideal conditions, and the grain quality going into storage was poor in many situations. It is very important to check grain bins on a regular basis for any potential storage issues, and to address those issues promptly. Otherwise, there can be considerable damage to grain in storage, resulting in a significant financial loss to the farm operator. Also, the wide range of temperatures in the past several weeks, from very cold in mid February to fairly mild in the past week,  can cause wide temperature variations in grain bins to occur. This can result in moisture migration in the bin and potential for grain spoilage. Farm operators should run aeration fans periodically to equalize the grain bin temperatures in order to help prevent this situation from occurring, and should check grain bins on a regular basis to observe for potential problems.

CORN  AND  SOYBEAN  ANNUAL  MEETING
The Blue Earth County Corn and Soybean Growers Associations have scheduled their 2010 Annual Meeting for Monday, March 15, at 6:00 PM, at the Community Center in Pemberton, MN. The Annual Meeting will include a social hour at 6:00 PM, a meal at 6:30 PM, followed by a presentation by Bruce Vincent, nationally recognized speaker Bruce Vincent, from Libby, Montana. He will speak on environmental stewardship, conservation, and family commitment by farm families and rural communities, sharing many experiences from growing up in a Montana logging family. He will discuss many of the public misconceptions that exist regarding environmental issues, and how farmers and others that rely on the soil, water and clean air are the in the best position to protect these natural resources for the future.

The Annual Meeting is open to all corn and soybean producers, and anyone else interested in the presentation by Bruce Vincent. The meeting is being sponsored by the Blue Earth County Corn and Soybean Growers Assn., and several area businesses. Anyone planning to attend the Annual Meeting is asked to RSVP to  Earl Ziegler at (507) 278-3770 or eziggy@myclearwave.net; or Brad Loeffler at (507) 257-2030 or loeffler@directv.net

**********************************************************************************
Note --- For additional information contact Kent Thiesse, Farm Management Analyst and
              Vice President, MinnStar Bank, Lake Crystal, MN. (Phone --- (507) 381-7960) ; 
              E-mail - kent.thiesse@minnstarbank.com)  Web Site - http://www.minnstarbank.com

February 22, 2010

CROP  INSURANCE  DECISIONS
Many farm operators are now finalizing their crop insurance decisions for the 2010 crop year. March 15th is the deadline to purchase crop insurance for the 2010. Following are some considerations :
 
BYE Crop Insurance Option for 2010
The USDA Risk Management Agency (RMA) has announced that the Biotech Yield Endorsement (BYE) corn crop insurance policies will be available to producers in Minnesota, Iowa, and other corn producing States on several biotech corn hybrids for the 2010 growing season. The BYE endorsement will provide a crop insurance premium discount of approximately 12-15 percent to corn producers that plant eligible biotech corn hybrids in 2010. Corn producers with an APH, RA, or CRC crop insurance policy for 2010 can qualify for BYE, provided that a minimum of 75 percent of the corn acreage on a given farm unit is planted to one of the qualifying corn hybrids, and provided that they comply with EPA refuge acre requirements for the BYE biotech corn hybrids. Growers that are interested in BYE for their 2010 corn crop insurance should contact their Crop Insurance Agent for more details.

Enterprise Units :   
In 2009, the USDA Risk Management Agency (RMA) increased the federal subsidy for purchasing APH, CRC, or RA insurance coverage under “Enterprise Units”, which combines all acres of a crop in a given county into one crop insurance unit. Many producers now use “Optional Units”, which allows producers to insure crops separately in each township section. There are some substantial premium savings by switching from optional units to enterprise units. Producers in the Midwest can likely upgrade their 2010 crop insurance coverage for corn and soybeans to 80 percent or 85 percent with enterprise units for about the same premium cost as 75 percent crop insurance coverage with optional units.  However, producers need to be aware of the limitations of insurance coverage on individual farms with enterprise units. In 2009, some producers had crop losses on individual farms, but were on enterprise units, and as a result were not eligible for any insurance indemnity payments. Enterprise units appear to work quite well when a producer has most of their land in the same general area, and when supplemental hail insurance coverage is also part of the overall risk management plan. Producers should contact their crop insurance agent to better understand insurance coverage with enterprise units.

ACRE and SURE
The Average Crop Revenue Election (ACRE) and the Supplemental Revenue Assistance Payment Program (SURE) were added as part of the 2008 Farm Bill. The ACRE Program offers an alternative method of calculating farm program payments triggered by crop revenues (yield x price), as compared to the traditional price-based counter-cyclical payments (CCP’s). The SURE program is the so-called “permanent disaster program”, is also based on crop revenues in a given year, and requires crop insurance coverage. While there are some similarities in the calculations used for the ACRE and SURE programs to CRC and RA crop insurance policies, the ACRE and SURE programs function very differently. The ACRE program is based on statewide yield averages and national average grain prices, and potential payments are not made until nearly a year after harvest. SURE payments are based on a County being declared a Federal Disaster Area by USDA, the farm having sufficient losses to qualify, and national average prices, and again payments do not usually arrive until a year or longer after the crop was harvested. CRC and RA insurance policies are based on farm APH yields, prices are based on CBOT base and harvest prices, and payments are made as soon after harvest that final yields are verified. Enrollment in the ACRE program, or potential eligibility for SURE, should not be considered or be a factor when making crop insurance decisions for the 2010 crop year.

2010 Insurance Coverage :  
Other than the BYE Endorsement, the use of “Enterprise Units”, or considering a group insurance policy (GRIP), most provisions for crop insurance policies are very similar to previous years. Most producers have a pretty good handle on the mechanics of standard APH (yield only) multi-peril insurance policies, compared to RA and CRC revenue coverage policies (yield and price). There has been more interest in the past couple of years in Group Risk Income Protection (GRIP) insurance policies that are based on County average crop yields and CBOT prices, due to the lower premium prices for GRIP policies. Producers need to thoroughly analyze these types of crop insurance policies with their crop insurance agent before switching from the more traditional CRC and RA-HP policies.

The Crop Insurance base market prices for 2010 are as follows :

2010 APH Market Prices are :

• Corn --------------  $ 3.90 per bushel
• Soybeans -------- $ 9.15 per bushel
• Spring Wheat --- $ 5.29 per bushel
  

2010 RA and CRC Base Prices will be finalized on March 1, 2010.

As of February 19, the RA and CRC base prices are estimated at :

• Corn  -------------- $ 3.95 per bushel
• Soybeans  ------  $ 9.15 per bushel
• Spring Wheat --  $ 5.42 per bushel

A reputable crop insurance agent is the best source of information to find out more details of the various coverage plans, to get premium quotes, and to help finalize 2010 Crop Insurance decisions. Following are some web sites with very good crop insurance information:

• University of Illinois FarmDoc :   http://www.farmdoc.uiuc.edu
• Iowa State Univ. Ag Decision Maker :    http://www.extension.iastate.edu/agdm
• USDA Risk Management Agency (RMA) :    http://www.rma.usda.gov

**********************************************************************************
Note --- For additional information contact Kent Thiesse, Farm Management Analyst and
              Vice President, MinnStar Bank, Lake Crystal, MN. (Phone --- (507) 381-7960) ; 
              E-mail - kent.thiesse@minnstarbank.com)  Web Site - http://www.minnstarbank.com

Common Ways ID Theft Happens:
Skilled identity thieves use a variety of methods to steal your personal information including:

• Dumpster Diving
• Skimming
• Phishing
• Changing Your Address
• "Old-Fashioned" Stealing

To learn more about ID theft and how to deter, detect, and defend against it visit http://www.ftc.gov/idtheft.

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