New Guidelines for Cover Crop Termination Affects Crop Insurance

April 22nd, 2014

If you planted a cover crop last fall and need to terminate it this spring in fields that will be planted to corn or soybeans, when should you kill the cover crop? Timing for termination of a cover crop can affect whether the crop insurance coverage attaches for the corn and soybean crop yet to be planted.

The USDA’s Risk Management Agency (RMA) has issued new guidelines for cover crop termination in 2014 that are slightly different from last year.  RMA officials made these changes after meeting with officials from USDA’s Natural Resources Conservation Service (NRCS) and the Farm Service Agency (FSA). Through the interagency working group a consistent and flexible cover crop policy can be applied across all USDA agencies.

With the new guidelines farmers can hopefully obtain the conservation benefits of cover crops while minimizing risk of reducing yield to the following crop due to soil water use.

The NRCS Guidelines for 2014 use four strategic management zones across the nation. Iowa has two of those zones. As the accompanying map shows, about a third of Iowa (western portion) is in Zone 3, while the rest of Iowa is in Zone 4.

If you are in Zone 3, you must terminate the cover crop at or before planting the subsequent crop, which is likely corn or soybeans. In Zone 4, the rest of Iowa, you must terminate the cover crop at or within 5 days after planting the subsequent crop if you want the subsequent crop to be insured.

cover crop termination zones 2014

Termination is not about a date; it’s about when you are going to plant the subsequent corn or soybean crop.  The cover crop, if it is not 100% destroyed, will compete with corn or soybeans for moisture in the soil. That’s the reason for the different zones.

Termination means growth has ended for 100% of the cover crop in the field. These NRCS Guidelines basically state that you have to terminate growth of the cover crop before crop insurance coverage attaches to the corn or soybean crop you plant in that field.

You can still graze or hay a cover crop, but crop insurance will not attach to the crop following a cover crop if termination of the cover crop is not done according to these new guidelines. The key is you want to kill the cover crop if you want the crop insurance coverage to attach. Contact your crop insurance agent if you have questions. The 2014 Cover Crops Crop Insurance and NRCS Cover Crop Termination Guidelines FAQs are at: http://www.rma.usda.gov/help/faq/covercrops2014.html.

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April 22nd, 2014

Client Corner: How can I find a rental rate for a piece of machinery?

April 21st, 2014

How can I find a rental rate for a piece of machinery?

Rental rates for some machinery items are shown on the ISU Extension Custom Rate Survey. For items where just the custom rate is reported, a worksheet for estimating rental rates for those items is included at the end of the Custom Rate Survey. The calculations and an example using a Tandem Disk are included below.

Estimating a Machinery Rental Rate

Example:

Tandem Disk

1. Custom charge (includes labor, fuel, tractor)

$________/acre

$14.20

2. Percent of custom charge that is for interest, insurance, depreciation, and repairs (excluding fuel and labor) (use 60% for tillage, 65% for planting and harvesting)

x ________%

x 60%

3. Rental value, including tractor (1 x 2)

= $________/acre

= $8.52

4. Tractor rental value, if tractor is not provided:_______HP x $_______per hp-hour rental rate / _______acres/hour =

Ex: 150 HP x $.27 (per hp-hour rental rate) / 15 acres/hour = $2.70

– $________/acre

– $2.70

5. Implement rental value, without tractor (3 minus 4)

= $________/acre

= $5.82/acre

 

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Smith-Lever Resolution

April 2nd, 2014

The Iowa Senate has launched the centennial celebration of the Smith-Lever Act, the founding legislation of the nationwide Cooperative Extension System. Representatives from ISU Extension and Outreach took part in the event at the Iowa Capitol. Watch the video.

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New farm program to provide enrollment decisions

March 27th, 2014

Contributed by Steven D. JohnsonFarm Management Specialist, Iowa State University Extension, sdjohns@iastate.edu, 515-957-5790.

Johnson_Steve_smThe 2014 farm bill is now law and the USDA Farm Service Agency (FSA) officials are writing rules and regulations to carry out new programs. The five-year farm bill eliminates direct payments, Counter-Cyclical Payments (CCP) and ACRE (Average Crop Revenue Election (ACRE) programs for commodity crops. Replacing them are some new risk management options that farmers must choose from by FSA farm number.

Crop insurance remains the backbone of the farm financial safety net. It will be augmented by the new farm program. Farmers can invest in their own risk management by buying crop revenue insurance so they are protected annually should a decline in yield and/or a drop in futures price occur.

To protect farmers from multiple year downturns in cash prices or a decline in revenue, the new bill introduces two new programs.  Farmers will choose between a revenue program that covers price and yield losses — Agricultural Risk Coverage (ARC) and a price-only program known as Price Loss Coverage (PLC). It will be several months before the new USDA farm program sign-up begins – probably next winter.

Crop coverage options

Farmers who choose ARC will have to make another decision of whether to enroll in county ARC on a commodity-by-commodity basis or choose an individual farm ARC that combines all the program commodities on the farm together.

Payments for the county ARC occur when actual county yield times the national marketing price for a commodity is below the ARC revenue guarantee for that crop year. Farm ARC would issue payments depending on whole farm revenue, since program commodities are combined. The program covers losses on 85% of the base acres for the county option and 65% of base acres for farm coverage.

The ARC guarantee provides a range of revenue protection from 76% to 86% of historical revenue, with farmer-purchased crop insurance expected to cover deeper losses. Farmers who enroll in ARC may not buy (Supplemental Coverage Option) SCO insurance beginning in 2015 because they are very similar products.

PLC is a target-price program that makes payments when national average cash crop prices drop below a “reference price” set in the farm bill. The reference prices are: $3.70 per bushel for corn, $8.40 per bushel for soybeans and $5.50 per bushel for wheat. Beginning in 2015, PLC enrollment also allows the purchase of SCO insurance to reduce the traditional crop insurance deductible levels. Only farmers enrolled in the PLC program may buy SCO insurance and county yields are used.

Farmers along with their landowners on rented ground have to make a one-time, irrevocable decision to enroll a farm in ARC or PLC for the life of the five-year farm bill. If a farmer doesn’t make a decision, farms are automatically enrolled in PLC beginning in 2015.

To help decide on which program to use, farmers may have to review historical planted acres due to the one-time choice of reallocating base acres using the average for the years 2009 through 2012. However, the reallocation of acres by crop cannot exceed the total historical base acreage. In addition, farmers might want to compare yield information for their farms to their county yields for the years 2008 through 2012.

Payment triggers for both the ARC and PLC programs are based on marketing year average prices. Thus any payments for revenue or price losses won’t be made until the year following a loss.

More information to come

It is too early to know for sure which program will be best for Corn Belt farmers, as the final rules and regulations are not yet known. Once USDA releases the information, farmers and landowners should have time to make enrollment decisions.

A preliminary analysis of the two programs suggests, for 2014, ARC’s price coverage level is more favorable for corn and soybeans while PLC’s reference price is more favorable for other crops such as peanuts, rice, barley and wheat. However, farmers will need to consider how the two programs will work over the life of the five-year farm bill; or through the 2018 crop year.

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March 25th, 2014

Charles Brown Joins ISU Extension and Outreach

March 11th, 2014

charlesBrownCharles Brown, of rural Ottumwa, joined Iowa State University Extension and Outreach Feb. 24 as a farm management specialist serving the 12-county southeast Iowa agricultural community. Brown becomes one of eight extension farm management specialists that provide educational opportunities around the state. Through meetings, presentations, Ag Decision Maker newsletter and website, and individual consultations they connect farmers and agribusiness professionals with university research and resources.

“Charles brings a wealth of knowledge and experience about farm financial management, risk management and the economics of farming to the ISU Extension and Outreach team,” said John Lawrence, director for Agriculture and Natural Resources Extension and Outreach.

Brown, a lifetime resident of the Ottumwa area and graduate of Iowa State University, has served southeast Iowa farmers throughout his career as a financial and business planning consultant with Iowa Farm Bureau Federation. Over the years, he has worked closely with ISU Extension and Outreach specialists partnering with Extension and Outreach to offer seminars and workshops, served on the Wapello County Extension Council and several boards at Iowa State University – Center of Agriculture Law and Taxation board and Iowa Grain Quality Initiative committee.

“I have always enjoyed working with ISU Extension and Outreach and believe it is important for people to have a place to go for unbiased information,” said Brown. “Farmers have had several very good years recently, but the next few years will be different. There are things they will need to think about as they consider their finances and how to manage their risks. I’m looking forward to being their extension farm management specialist and bringing information to them so they can make those decisions.”

Brown’s office is located at the Mahaska County Extension Office, 212 North I Street, Oskaloosa. He can be reached by emailing crbrown@iastate.edu or calling 641-673-5841.

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Free Online Course on Health Insurance for Farm Families – March 13th

March 7th, 2014

ISU Extension and Outreach Hosting Free Online Course on Health Insurance for Farm Families   Scheduled for March 13th

The Affordable Care Act (ACA) provides important benefits for farm families: expanded coverage, a greater choice of insurance providers, and tax credits for small employers that offer coverage to their employees. Farmers are affected by ACA regulations in two ways. First, farm families, like other Americans, are consumers who will be making health care decisions for their families. Second, many farmers employ farm workers on a temporary (seasonal) or permanent basis and may be affected by the Affordable Care Act employer mandate provisions. With new options and requirements in health care, farm families are invited to attend a free workshop offered by Iowa State University Extension and Outreach.  The workshop will help Iowa farm families understand how to the Affordable Care Act (ACA) affects them as consumers making health care decisions for their families and as employers of farm workers. The workshop will take place Thursday, March 13th, 10:00am – 11:30am online at https://connect.extension.iastate.edu/acafarmfamilies/.  On the day of the webinar, go the this web address 10 -15 minutes prior to the webinar, click on the ‘Enter as Guest’ button, type in your first and last name, and click ‘Enter Room’. Please be patient and wait while the meeting room opens.

 

Through “You and Health Insurance: Making a Smart Choice for Farm Families” workshop, attendees will increase their knowledge and understanding of:

  • New health insurance options and requirements
  • Features of the Affordable Care Act (ACA) for farm families
  • Resources to provide additional information about the ACA and health care
    decision-making

“This program is about helping farm families understand their options given the changes in the health care law,” says Joyce Lash, family finance specialist of Iowa State University Extension and Outreach.

For information about webinar, contact the Mary Weinand, Henry County Extension
mweinand@mail.iastate.edu or 319-931-5087

This program was supported by a grant from the US Department of Health and Human Services. The contents are solely the responsibility of Iowa State University Extension and Outreach and do not necessarily represent the [[official]] views of the Department. [[US DHHS.]]

 . . . and justice for all The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, gender, religion, age, disability, political beliefs, sexual orientation, and marital or family status. (Not all prohibited bases apply to all programs.) Many materials can be made available in alternative formats for ADA clients. To file a complaint of discrimination, write USDA, Office of Civil Rights, Room 326-W, Whitten Building, 14th and Independence Avenue, SW, Washington, DC 20250-9410 or call 202-720-5964.

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AgDM website updates for February 2014

February 20th, 2014

Ag Decision Maker 

Business Solutions for Farms and Agribusiness from Iowa State University Extension and Outreach

February Newsletter (pdf)

New and Updated Files

Flexible Farm Lease Agreements

Iowa Farm Outlook

Outlook Information for Crops and Livestock

February Newsletter (pdf)

Livestock: January Cattle Report from USDA

Crops: A Little Bounce in February

AgMRC Renewable Energy Newsletter

National Center for Value-Added Agriculture

February Newsletter (pdf)

Choices – The Magazine of Food, Farm, and Resource Issues

A Publication of AAEA, Agricultural & Applied Economics Association

Theme Overview: Developing Local Food Systems in the South

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DNR Regulations Workshop on Feb. 20

February 6th, 2014

DNR Regulations for Your Farm WorkshopThe Southwestern Community College Agriculture Department will be hosting a livestock producer workshop called “DNR Regulations for Your Farm: Are you in compliance with upcoming farm inspections?” on Thursday, February 20 from 6:30-8:00 p.m. at the Allied Health and Science Center on the main campus in Creston, Iowa. There is no cost to attend and light refreshments will be provided.

EPA Region 7 and the Iowa DNR recently signed a work plan agreement that established guidelines for evaluations of livestock and poultry farms. This plan obligates DNR to evaluate livestock farms larger than 300 animal units and document whether the farms are in compliance with the Clean Water Act. Over 8,500 livestock farms are expected to be evaluated in the next five years.

Guest speakers include Dan Olson, Iowa DNR Environmental Specialist; Brian Waddingham, Executive Director of the Coalition to Support Iowa’s Farmers; and Wayde Ross, NRCS District Conservationist who will explain the work plan, resources available for impacted farmers, and EQIP funding to help producers make necessary changes.

“Livestock regulations are complex, sometimes ambiguous and are constantly changing,” says CSIF Executive Director Brian Waddingham. “For Iowa’s livestock and poultry farms to prosper, farmers must know and understand state and federal regulations and the resources available to help them remain viable on the land for generations to come.  This workshop will help livestock farmers better understand how the work plan agreement will affect them and their farm.”

Questions about the event may be directed to Francine Ide at (641) 344-2225 or ide@swcciowa.edu.

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