In the United States, participation in the U.S. Department of Agriculture's federal crop insurance program has grown steadily since the mid-1990s to become the single largest individual program providing financial support to producers under the 2014 farm bill. The growth in crop insurance programs — both in the United States and developing countries — has been driven in part by the premium subsidies provided by the government. In a new report from the USDA's Economic Research Service, researchers Katie Farrin, Mario Miranda and Erik O'Donoghue examined how a farmer's financial situation — particularly in terms of savings and wealth — may affect not only their coverage level election, but even whether or not to carry crop insurance at all. One of the study's general findings was that the demand for insurance will decline as the interest rate on savings rises. Similarly, farmers will save more and insure less, as insurance premium rates increase. However, an exception to these general findings would be for those farm households who are less wealthy. The study also found that the demand for crop insurance, when examined over multiple years, is primarily driven by the farmer's financial wealth rather than one's attitude toward risk. Therefore, the purchasing of insurance and the choice of coverage levels are heavily determined by the producer's income and savings. The demand for crop insurance was also found to be reduced at both the lower and higher levels of farm wealth. However, the reasons differ depending on what side of the spectrum the farm household falls. High-wealth farmers may not purchase insurance at all and may instead use savings to self-insure. By comparison, households with low wealth may not purchase crop insurance simply because they cannot afford it. The researchers also found that farmers do not make production decisions based solely on what would be best considering the current crop season. Instead, they choose to manage their farms in a way that helps them earn the most value over the lifetime of the farm, with the demand for crop insurance dropping the longer the farm's expected time horizon. When households can save over many years, their insurance decisions will depend not only on time, but also a household's wealth and history of farm income. Even among farm households with the same level of wealth, predictions about insurance decisions will differ depending on whether a household expects to generate farm income for two crop seasons or many. An analysis of existing USDA data also shows that insurance and savings are substitutes, unless a household's annual farm income is relatively low. In general, greater savings result in lower demand for crop insurance among U.S. crop farmers. Still another finding from the study was that operators with higher amounts of debt are more likely to purchase insurance, perhaps to avoid falling further into debt should a weather event affect production in a given season.

USDA survey to measure financial health of dairy producers

Beginning in January, representatives from the USDA's National Agricultural Statistics Service will visit dairy farms across the nation to collect data for the final phase of the 2016 agricultural resource management survey. This annual survey gathers in-depth information on production practices, costs, and the financial well-being of American farm families producing selected commodities on a rotational basis. This year, the survey places added focus on conventional and organic dairy operations. The last time that the dairy sector was the subject of this annual survey was in 2010, which focused only on conventional dairy operations. The results from the 2016 survey will help USDA and other policymakers analyze the impacts of the new Dairy Margin Protection Program that was authorized by the 2014 farm bill, and launched in 2015. All dairy farmers selected to participate in the 2016 survey will be notified by a postcard. Following receipt, trained enumerators will make appointments and visit the participating farms to gather the information through personal interviews that will begin in late January and continue through early April.

FSA committee election results announced

Ballots for the Farm Service Agency's county committee election were mailed to all eligible voters in November. Local offices recently tabulated all returned ballots and have announced the following election results. In Chippewa County, Lane Schwitters of Raymond was elected to his first term. In Kandiyohi County, John Cunningham of Atwater was re-elected to his second term. In Meeker County, Tom Walsh of Litchfield was re-elected for a second term. In Pope County, Jane Reents of Villard was re-elected to her third term. In Renville County, Orlynn Henga of Sacred Heart was re-elected to a third term. In Swift County, Jess Berge of Sunburg was elected to his first term. In Yellow Medicine County, David Luepke of Belview was re-elected to his second term. All elected candidates began serving a three-year term Jan. 1. There are nearly 7,800 county committee members serving the 2,124 Farm Service Agency offices located nationwide. Committees typically consist of three to five members that make many important decisions regarding the local administration of federal farm programs. Source - http://www.wctrib.com