Farmers and ranchers are using a broader mix of tools to manage risk as markets, weather, and policy uncertainty continue to shift. A new report from the USDA Economic Research Service shows savings and off-farm income remain the most common risk management strategies on U.S. farms.
The report, authored by USDA economists, examined risk management practices from 1996 through 2020. Producers increasingly rely on a combination of on-farm strategies, crop insurance, marketing contracts, government programs, and longer-term planning tools.
Participation in the Federal Crop Insurance Program has remained relatively steady since 2005, but usage has increased among very large farms while declining among smaller operations. Government payments tied to programs like Agriculture Risk Coverage (ARC), Price Loss Coverage (PLC), and Dairy Margin Coverage (DMC) reached fewer than 15 percent of farms in most years.
Succession planning remains another weak spot. Fewer than one-third of producers had a formal succession plan in place by 2019, though adoption increased over time and was more common on larger farms.
Source - https://www.rfdtv.com
