The New Farm Bill Offers Many Options Requiring Careful Decisions

Adams points out that the transition payment is paid on 2013 base and is subject to a limit of $40,000 per legal entity. This payment is separate from the $125,000 limit for other programs impacting other crops, and eligibility is not affected by other program choices or planting decisions made this year.

In 2015, STAX will offer cotton growers several options for coverage. It can be purchased as the only insurance policy covering an acre, or it can be purchased in addition to existing insurance policies. It will be based on actual county income relative to an expected income and is designed to cover a range from 90 percent down to 70 percent of expected county income.

“Indemnities under STAX are triggered by the revenue experience at the county level or a combination of counties, if needed, to get an actuarially-sound product,” explained Adams. “It is not based on individual experience. It is the collection of individuals in a county and that revenue experience.

“There’s a 10 percent deductible if you purchase STAX at its maximum,” he continued. “If the county actual income comes in above 90 percent, there’s no STAX indemnity. If it comes in anywhere between 90 and 70 percent, an indemnity is triggered. And if county income falls below 70 percent, then the STAX indemnity is at its maximum level.”

STAX will carry a premium subsidy of 80 percent, with producers paying the remaining 20 percent. However, the lower band of STAX coverage cannot overlap the coverage level of an underlying insurance policy on that same acre, so growers will need to make decisions about balancing their insurance coverages.

“STAX will be offered for irrigated and non-irrigated acres to the greatest extent possible,” added Adams. “And there will be some new features and options that we’ll learn about as we go further into the year that will allow producers to scale their indemnity up or down depending on how much of the protection factor they purchase.”

Also coming in 2015 is the Supplemental Coverage Option (SCO), which will be available for Upland cotton and other commodities such as corn, wheat, soybeans, and rice. SCO requires underlying insurance coverage and helps provides coverage for a portion of that policy. However, it cannot be purchased on acres covered by STAX or for commodities covered under ARC.

While STAX coverage is based on revenue experience, SCO indemnities can be triggered by either county yield or revenue experience. “There are some similarities in the concepts,” said Adams. “There are some differences, though, in the details.”

 

Visit the Cotton Grower Guide to the 2014 Farm Bill webinar for more information from Dr. Joe Outlaw and Dr. Gary Adams.

 

Keep In Mind

With all of the new insurance products and programs coming for all crops, both Outlaw and Adams remind growers to keep a couple of things in mind as they begin sifting and sorting through all of the options.

First, the new Farm Bill now requires growers to have a conservation compliance program in place in order to be eligible for any insurance premium subsidy.

And second, don’t be shy about asking for help. Education for this Farm Bill is going to be a continuing process, since final rules and provisions are still being determined.

Investigate online decision tools like the one being developed by Texas A&M, AFPC and the University of Missouri. Seek out your FSA officials for answers as soon as they have the information in hand. And ask your insurance agent about all of the options and the right type of coverage for your operation.

Topics: ,

Leave a Reply

News Stories
News

Caucus Schedule Set for Cotton Board Nominations

June 27, 2016

The caucus schedule for Certified Producer Organization and Certified Importer Organizations tasked with nominating candidates to fill vacancies for a three-year term on the Cotton Board has been set.

News

First Bale of Cotton for 2016 Harvested in Texas

June 20, 2016

A Rio Grande Valley grower has delivered the first bale of cotton harvested in the U.S. this season to a gin in Harlingen, TX.

News

Sunbelt Growers to Visit Idaho Ag Operations

June 15, 2016

Twelve Sunbelt growers are visiting diverse agricultural production and processing operations in southern Idaho June 20-23 as part of the National Cotton Council's Multi-Commodity Education Program.

News

USDA Seeks Cotton Board Nominees

June 15, 2016

USDA is seeking nominees to fill 17 member and alternate positions on The Cotton Board.

News

Cotton Highlights from June WASDE Report

June 10, 2016

USDA’s June World Agricultural Supply and Demand Estimates report shows minimal reductions in domestic mill use, global production and ending stocks.

News

Cost Share Program Provides Much-Needed Assistance

June 7, 2016

The National Cotton Council and other industry organizations thanked Secretary of Agriculture Tom Vilsack for providing a one-time $300 million program that offsets a portion of a cotton producer's 2015 crop season ginning costs.

News

USDA Rolls Out Cotton Ginning Cost-Share Program

June 7, 2016

The USDA Farm Service Agency will provide an estimated $300 million in cost-share assistance payments to cotton producers through a new, one-time Cotton Ginning Cost-Share program.

Around The Gin
Product News

Monsanto Donates Research Center to Local Foundation

June 27, 2016

Monsanto Company has donated its 150-acre Leland Agronomy Center to The B.F. Smith Foundation, a nonprofit organization in the Mississippi Delta.

Product News

Record Yields Set by 2015 FiberMax One Ton Club

May 4, 2016

The 127 members who qualified for the FiberMax One Ton Club pushed cotton yields and quality to higher levels in 2015.

Product News

Meister Media Worldwide Website Relaunches With New Resources

April 22, 2016

Meister Media Worldwide — publisher of Cotton Grower magazine – has relaunched its corporate website, highlighting information and services available from one of agriculture’s leading media companies.

Product News

ReinCloud Promises Remote Control

April 18, 2016

New software set to combine irrigation management and data collection – all in the palm of your hand.

Product News

Search Begins for Deltapine Class of 17

April 14, 2016

Deltapine’s NPE program is nine years old, and the search for the company’s Class of 17 cotton varieties is underway.

Product News

Texas Farmer First to Plant Enlist Cotton Variety

April 11, 2016

Dean Hansen of El Campo, TX, was the first cotton grower in North America to plant the first commercially-available cottonseed with the Enlist cotton trait.

Product News

New Options for Roundup Ready PLUS Program

March 25, 2016

The Roundup Ready PLUS Crop Management Solutions program for 2016 includes a new tool for weed management and new incentives for farmers looking to fight insect pests in corn.

Product News

Greenleaf Launches easyFlow Closed Transfer System

March 24, 2016

Greenleaf Technologies has launched the company’s new easyFlow closed transfer system for the North American market.

Latest News
News

Caucus Schedule Set for Cotton Board Nominations

June 27, 2016

The caucus schedule for Certified Producer Organization and Certified Importer Organizations tasked with nominating candidates to fill vacancies for a three-year term on the Cotton Board has been set.

News

Registration Begins for Cotton Ginning Cost-Share Program

June 20, 2016

Just a reminder – registration for the USDA Cotton Ginning Cost-Share program is now underway at local Farm Service Agency offices.

News

First Bale of Cotton for 2016 Harvested in Texas

June 20, 2016

A Rio Grande Valley grower has delivered the first bale of cotton harvested in the U.S. this season to a gin in Harlingen, TX.

News

Sunbelt Growers to Visit Idaho Ag Operations

June 15, 2016

Twelve Sunbelt growers are visiting diverse agricultural production and processing operations in southern Idaho June 20-23 as part of the National Cotton Council's Multi-Commodity Education Program.

News

USDA Seeks Cotton Board Nominees

June 15, 2016

USDA is seeking nominees to fill 17 member and alternate positions on The Cotton Board.

News

Cotton Highlights from June WASDE Report

June 10, 2016

USDA’s June World Agricultural Supply and Demand Estimates report shows minimal reductions in domestic mill use, global production and ending stocks.

News

Cost Share Program Provides Much-Needed Assistance

June 7, 2016

The National Cotton Council and other industry organizations thanked Secretary of Agriculture Tom Vilsack for providing a one-time $300 million program that offsets a portion of a cotton producer's 2015 crop season ginning costs.

News

USDA Rolls Out Cotton Ginning Cost-Share Program

June 7, 2016

The USDA Farm Service Agency will provide an estimated $300 million in cost-share assistance payments to cotton producers through a new, one-time Cotton Ginning Cost-Share program.

News

USDA Extends Deadline for Recording Farm Structure

May 31, 2016

USDA has extended the deadline to July 1 for farmers and ranchers to restructure or finalize changes to their farm organization structures related to the Actively Engaged in Farming guidelines.

News

NCC Sets P.I.E. Program Tour Dates for 2016

May 24, 2016

The National Cotton Council (NCC) has scheduled tour dates and locations for the 2016 Producer Information Exchange (P.I.E.) Program, sponsored

News

Proposed Transform Label Drops Cotton

May 23, 2016

EPA is proposing a new registration for Transform that does not include cotton or other blooming crops. Public comment period is open until June 17.

News

Bayer Eyeing Monsanto for Possible Merger?

May 17, 2016

Bayer may be exploring a potential bid for Monsanto in a deal that would create the world’s largest supplier of seeds and farm chemicals.

News

Cotton Highlights from May WASDE Report

May 10, 2016

USDA’s May World Agricultural Supply and Demand Estimates report projects a 15% increase in U.S. cotton production for 2016/17, as global consumption of cotton stocks continues to grow.

News

Training Cotton’s Future Leaders

May 4, 2016

This summer, class is in once again at the ACSA International Cotton Institute and the Texas International Cotton School.

News

EPA: Glyphosate Not Likely to Cause Cancer

May 3, 2016

As part of an ongoing registration review, the EPA has again classified glyphosate as “Not likely to be carcinogenic to humans.”