Temporary Levee Allows For Lower Crop Insurance Premiums

Farmers must restore land to qualify for lower premiums despite levee fix.

Published on: Feb 28, 2012

The temporary construction of the Birds Point-New Madrid levee meets the standards needed for farmers to qualify for lower crop insurance premiums, but farmers must still bring land back into production. 

According to Eddie Hamill, State Executive Director for the Missouri Farm Service Agency (FSA), USDA officials confirmed that the temporary levee construction is considered "adequate protection" thereby qualifying agricultural producers for lower crop insurance premiums.

Last May, the U.S. Army Corps of Engineers (USACE) breached the Birds Point-New Madrid (BPNM) Levee. As a result, more than 130,000 acres of Missouri's most productive agricultural land in Mississippi and New Madrid Counties was extensively damaged.

Southeast Missouri farmers are gearing up for the 2012 crop year and will begin planting wheat and soybeans in the same area ravaged by floodwaters just 10 months ago. Although the Corps has worked diligently to restore the BPNM levee, inclement winter weather prevented completion of the project. In the interim, temporary barriers have been erected by the Corps to provide the protection required for area farmers to plant once again.

This is all good news for Mississippi County's wheat and soybean producers. However, until just recently, the temporary levee "fix" left producers wondering what impact the temporary structure would have on their crop insurance premiums. According to USDA's Risk Management Agency (RMA), "premium rates must adequately reflect the risks associated with growing crops in a given area."

Mississippi and New Madrid County producers need not worry any longer.

In a letter dated January 27, 2012, from Secretary of Agriculture Tom Vilsack to Stephen Burke, Chairman, Missouri Farm Service Agency (FSA) State Committee and a Mississippi County farmer, USDA confirms that, in fact, the temporary levee provides a flood protection level of 55 feet – a level considered by RMA to sufficiently support "standard" rather than "high risk" crop insurance premiums.

"FSA has been working diligently with RMA to obtain a favorable decision regarding crop insurance premiums for Mississippi and New Madrid County farmers," said Burke. "We are pleased that we can deliver the good news in time for the 2012 planting season."

Burke added, "Mother Nature unleashed her fury on Missouri agriculture in 2011. And, 'high risk' crop insurance premiums would have added 'insult to injury' in an area still reeling from the impacts of the floods."

Hamill reminds producers that adequate levee protection is just one piece of the puzzle for producers qualifying for lower insurance premiums. The other qualifier is in the hands of the producer.

According to RMA, in addition to adequate levee protection, the acreage destroyed by the floodwaters, "must be restored to the point that it can produce at least the same crop yield potential as prior to the flood event."

Again, Missouri FSA has played an integral role in the flood recovery process. Through FSA's Emergency Conservation Program (ECP), eligible producers in southeast Missouri have received much-needed financial assistance to rehabilitate flood-damaged land by grading and shaping, clearing debris, repairing conservation structures and other approved restorative measures.

"ECP funding was made available by FSA last year and Mississippi and New Madrid County farmers worked throughout the fall restoring their land," said Hamill. "Getting farmers back into the field and back into production has been a high priority for Missouri FSA – now, thanks to the partnering and program efforts of FSA, RMA and the Corps of Engineers, higher insurance premiums are one less thing these producers have to worry about."

Source: Missouri Farm Service Agency