A pilot revenue protection program, called Adjusted Gross Revenue, needs to be expanded so Nebraska producers are able participate.
Greg Ibach, director of the Nebraska Department of Agriculture, recently urged USDA to expand the program. It is currently available in a handful of states, but not Nebraska.
Administered by USDA's Risk Management Agency, AGR covers both crops and livestock.
"During the Governor's Farm Bill listening session, many Nebraskans told us the current farm bill tends to over-compensate in good crop years and not compensate enough when more assistance is needed," Ibach says. "Several individuals and organizations told the governor that they want more focus on farm revenue rather than just crop prices, since revenue protection provides a more predictable safety net. It is also less vulnerable to criticism from our trading partners. AGR would provide agriculture producers another important option to manage risk."
With AGR, a farmer can protect the revenue generated by his entire operation, including livestock, rather than just individual crops, as is the case under traditional crop insurance. AGR insures against the loss of revenue due to natural disaster, as well as market fluctuations. However, no more than 35% of the expected income can be derived from livestock, Ibach points out.
"The AGR program would an attractive risk management tool in Nebraska, where we have a larger number of diversified operations with both crops and livestock," he says. "The availability of the AGR program would improve economic stability for our producers, while lessening the need for future ad-hoc federal disaster payments."
Nebraska would be a particularly strong candidate for AGR expansion due to the state's support of the crop insurance program, according to Ibach. In 2004, nearly 87% of Nebraska's eligible farm acres were enrolled in the federal crop insurance program, one of the highest percentage rates in the nation.