Clearing Up The Misunderstanding About So-Called Shallow Loss Programs

Doggett explains why NCGA sees this as best way to provide safety net.

Published on: Nov 2, 2011

Much like the leaders of the Ag Committees have been working to get their farm policy recommendations to the Super Committee, farm and commodity groups have been hard at work to put their own suggestions in front of the Ag Committees. Recently, there's been quite a bit of discussion about a shallow loss program. National Corn Growers Association Vice President of Public Policy Jon Doggett says the term shallow loss is really a misnomer.

"Really what the attempt here is to help bridge that gap that exists for producers when they have a loss," Doggett said. "Part of that loss they are going to bear themselves and part of it we anticipate they will be covering because they will have crop insurance."

Doggett says NCGA believes this is the best way to provide a safety net.

"We think that while crop insurance has certainly improved over the last 10 years there are still some major issues that particularly corn growers have to deal with because of the lag in updating yields," Doggett said. "There are a lot of other issues that create some fairly significant holes in crop insurance and this is a way to cover part but not all of that hole."

According to Doggett it's all about ensuring growers receive federal assistance when they have suffered a loss, not when they don't.

"It is a market based revenue risk management tool; it follows the market up and it follows the market down with a five-year rolling Olympic average," Doggett said. "So a grower has some protection on the way up and some protection on the way down, and just a better reflection of how that grower is going to manage their risk."

Doggett says this is an idea gaining traction with cotton and soybean producers.