Hot topics & tips on the ever changing business of farming

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Prevent Plant and Late Planting Reminders

The final plant date for Iowa corn is May 31st (soybeans June 15th).

If you have not planted by the final plant date, you need to notify your crop insurance agent within 72 hours if you don’t intend to plant during the late plant period. The prevent plant corn payment factor is 55% of your guarantee (soybeans 60%). In most cases, the maximum number of eligible acres for prevent plant is the maximum number of insured acres reported for the crop in any one of the four most recent crop years. If you have added land or no history in the county, other rules will apply. On the flip side, to receive a prevent plant payment, at least 20 acres or 20% of the insurable crop acreage in the unit needs to be prevented from planting. Remember prevent plant is eligible only if you are prevented from planting due to an insured cause of loss.

If you want to plant after the final plant date, you will take a reduction in guarantee. The late plant period ends on June 25th for corn (July 10th for soybeans). During the late plant period, you lose 1% of your guarantee per day until the crop is planted. Coverage after 25 days of the late plant period will be 55% of your insurance guarantee for timely planted acreage (soybeans 60%).




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ACR-CO vs PLC Payments for 2014 Farm Bill

Farmers made a one-time program election for the 2014 Farm Bill. Many farmers in our area selected ACR-CO knowing large payments would be received the first few years. PLC was unknown due to the unknown of the marketing year average price. Would corn fall below $3.70 and soybeans under $8.40?

Now we can look back and see how ARC-CO and PLC worked. Here is a chart showing Hardin County, IA’s ARC-CO payments from 2014 to (estimated) 2018.

ARC-CO Payments

You can see that payments were high in the first couple years, then dropped off to zero in the last couple years. Total dollars received per acre was $122.39. This data is provided by ISU Decision Maker. You can select any county you would like to review. You can also input projections for the 2019-2023 crop years.

PLC coverage triggers when the marketing year average price falls below $3.70 for corn and $8.40 for soybeans. In the chart, you can see that corn fell below $3.70 in 2015-2018. PLC Payments

2014 Farm Bill PLC payments are based upon 90% of average farm yields from 2008-2012. The farm yield is different for each farm. I input an above average 170 bu. per acre farm yield in this scenario to see the payout potential, $117.17 over the 5 year span. In 2020, farmers will be able to update farm yields to reflect the 2013-2017 crop years.

Farmers will be able to elect ARC-CO or PLC for the 2019 and 2020 crop years when they certify their acres this year. In 2021-2023 farmers can change their program selection every year. These charts are helpful in running scenarios to make farm bill program decisions, ISU Decision Marker

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SCO Coverage

Let’s refresh our memory about SCO that was first introduced with the 2014 Farm Bill.  What is SCO and how does it fit into crop insurance and Farm Bill Program decisions?

SCO, Supplemental Coverage Option, is a crop insurance product. This means SCO is purchased from a crop insurance agent and a premium is charged for coverage. 65% of the premium cost is subsidized by the federal government. The coverage provided is county level revenue protection. Payment triggers below 86% of county revenue down to the federal crop insurance level carried on the policy.

Here are 4 factors when considering SCO:

#1 – SCO is only available for farms that have elected PLC, Price Loss Coverage, for their Farm Bill Program. Many farmers in Central Iowa elected ARC-CO for the 2014 Farm Bill. This made them ineligible to elect SCO coverage. With the new farm bill, farmers will be able to re-elect ARC-CO or PLC for the 2019 and 2020 crop years. The FSA office has indicated that the 2019 & 2020 election will happen when certifying acres this spring/summer. Then from 2021-2023 farmers can change their program election each year.

#2 – SCO provides coverage from 86% of county revenue down to your crop insurance level. For example: If you carry 75% Revenue Protection Coverage, SCO will cover from 75% to 86% of county revenue. In Central Iowa, most farmers carry 80-85% Revenue Protection. Therefore, SCO coverage would be minimal, 1-6% coverage.

#3 – SCO is county level protection, therefore there is not protection for individual losses. Prevent Plant and Replant Coverage is not provided. When considering the farm programs, PLC payments are based on individual farm yields and ARC-CO is based on county yields. In 2020, you will be able to update your yields to reflect the 2013-2017 crop years. If you have high yields in comparison to the county and price falls below the reference price ($3.70 corn and $8.40 beans), your PLC payment would potentially be attractive compared to county coverage.

#4 – Since SCO provides a 65% premium subsidy, you might wonder if scaling back your individual coverage would cheapen your crop insurance cost. For Optional Unit coverage, you will see a premium decrease per acre.  Is the rate savings attractive enough to  give up individual coverage? For the higher subsidized Enterprise Unit coverage, the scenario is less likely.

SCO has nice advantages for farmers who elect PLC for their farm program, don’t carry a high level of individual crop insurance, or don’t qualify for Farm Bill Program payments.

If you want more information regarding SCO and your operation, please contact me at or 641-847-3555.