Average crop insurance premiums decreasing in 2004

Mar 08, 2024

Changes to the 2024 Crop Insurance Program, administered by the Saskatchewan Crop Insurance Corporation (SCIC), were announced Tuesday.

For 2024, multi-peril crop insurance average coverage is $389 per acre, a decrease from 2023, largely due to an average decrease in insured commodity prices. As a result, the average premium is also decreasing to $12.71. Producers' coverage and premium are individualized to their operation. Coverage reflects each producer's production records and premium reflects each producer's claim history.

SCIC's existing Weather-Based Programs include Forage Rainfall Insurance, Corn Rainfall Insurance and Corn Heat Unit Insurance. The rainfall insurance programs protect if seasonal precipitation is below the long-term average, adjusted for extreme heat. The Corn Heat Unit Insurance Program insures against a shortage of heat units over the growing season. A selection of program options allows producers to tailor coverage to their needs.

Introduced for the 2024 Crop Insurance Program, SCIC's weather-based programs now provide options to insure intercrops and additional feed crops. The Mixed Forage Rainfall Insurance Program protects any forage feed crop not previously covered under weather-based programs, including mixed forage, greenfeed and silage, if seasonal precipitation is below average. With the Intercrop Rainfall Insurance Program, annual intercrops intended for harvest can now be insured for below average seasonal precipitation.

Additionally, coverage is increasing for the 2024 Forage Rainfall Insurance Program. Coverage levels now better reflect the productive capacity of the insured acres and increased transportation allowance (which recognizes the costs associated with replacing lost feed). Producers can select from three levels of coverage, Low, Medium, and High, offering flexible risk management and related premium cost options.

For 2024, SCIC is pleased to announce an additional 38 weather stations to supplement its existing network. All weather-based programs are enhanced by this increased weather station density province-wide. With 224 weather stations across the province, most land is located within 30 kilometres of at least one weather station. One weather station can be selected for each insured land location. This allows producers to insure each of their land locations with relevant coverage.

"During our town hall drought meetings last summer, producers emphasized changes to programs such as Forage Rainfall Insurance Program were needed to provide better coverage and flexibility, especially during times of prolonged drought," Saskatchewan Cattlemens Association Chair Keith Day said.

"It's clear to SCA that Minister (David) Marit and SCIC took the feedback from those meetings into consideration when making changes such as increasing the number of weather stations, improving communications and increasing the transport allowance. Expanded coverage for cover cropping, green feed and silage is also a significant improvement. We will continue to work with SCIC to improve programs for the benefit of cattle producers."

“The improvements made to the forage and rainfall insurance options underscore the ongoing evolution of the program in meeting the requirements of producers," APAS Vice-President Bill Prybylski said.

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Agricultural Market Update: Grain Prices, Crop Conditions, and Weather Impacts

Welcome back to our channel where we provide comprehensive updates on the latest trends and changes in the agricultural sector. This week, we're looking at significant movements in grain prices, crop conditions, and the effects of weather patterns. Let's dive into the details:

Grain Price Decline Grain prices have fallen to their lowest levels since 2020, with December corn down 4.3% and November soybeans losing 3.1%. This decline is partly due to the beneficial moisture brought by Hurricane Beryl to the Midwest, which has improved crop conditions significantly. The USDA reported that corn and soybean crops are in their best condition in four years, contributing to the downward pressure on prices.

Record Short Positions and Market Sentiment Fund traders have increased their net short positions in the corn market to a record level, with a net short of 347,000 contracts of corn. This reflects a bearish sentiment in the market, further influencing grain price dynamics. Similar selling trends were observed in soybeans and SRW wheat, indicating broad market caution.

Weather Impact and Forecast Hurricane Beryl has brought significant rainfall across Arkansas, Missouri, western Tennessee, western Kentucky, and southern Illinois, with more expected over Missouri, Illinois, and Indiana in the coming days. Despite this, the market is currently more focused on the moisture benefits rather than potential heat risks forecasted in the 6-10 and 8-14 day periods.

US Crop Conditions Corn and soybean conditions have shown slight improvements last week, with corn rated 68% good to excellent and soybeans at 68%. These are among the best ratings for this time of year since 2020, suggesting robust crop health that could continue to influence grain prices.

Winter Wheat Harvest and Spring Wheat Conditions The US winter wheat harvest is progressing well, ahead of schedule with significant portions already harvested in Kansas and Texas. Spring wheat conditions are also favorable, with 75% rated good to excellent, although there have been some declines in states like Idaho, South Dakota, and Washington. Brazil's Corn Harvest and US Exports Brazil's second corn crop harvest is advancing rapidly due to favorable hot and dry conditions, with 63% of the crop already harvested. Meanwhile, US corn shipments saw a substantial increase last week, indicating strong export demand, which contrasts with the recent drop in domestic grain prices.

Ongoing Developments Lastly, the USDA reported a flash sale of corn, with significant quantities sold to unknown destinations, scheduled for delivery over the next two marketing years. This could signal ongoing international demand for US corn despite lower prices.

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