Crop Insurance Ratings, Precision Agriculture Focus of Arkansas Agricultural Economist

Jun 27, 2022

With farmers in the national spotlight amid soaring production costs, crop risk mitigation practices like crop insurance and futures options are more important than ever for the nation's producers of food, fiber and fuel.

Agricultural economists with the Arkansas Agricultural Experiment Station, the research arm of the U of A System Division of Agriculture, work to gather and analyze data that can improve a farmer's decisions for long-term business viability.

Eunchun Park, assistant professor in the Department of Agricultural Economics and Agribusiness, says crop insurance is the easiest way to mitigate the inherit risks in agriculture.

Crop insurance protects agricultural producers against crop losses resulting from natural causes. The program, administered by the U.S. Department of Agriculture's Risk Management Agency, offers several different plans for crops and livestock. Availability of these crop policy plans varies by state and county.

Park works with the Fryar Price Risk Management Center of Excellence to provide farm, industry, government and academic leaders with research-based information and tools to assist them in making decisions. The Fryar Center is a unit of the U of A System Division of Agriculture and the U of A and facilitates research, teaching and outreach focused on risk management issues.

"My personal goal is to provide better ranking for farmers that is fair to everybody," Park said. "I want to provide fairer and more accurate methods to provide fair premium rates. That makes the participation rate in crop insurance increase. That is the key to farmers to avoid price-related risk in this era."

Park said that having good data is required to develop actuarially sound premium rates. Seeing the potential of Bayesian Kriging — a "geostatic method" of spatial statistics commonly used in weather forecasting — Park developed a related method to overcome problems with obtaining crop yield data. Using this new method, he incorporated yield data from areas with similar geography, crops and precipitation to fill in the missing gaps with an estimated average.

In a 2021 paper titled "Estimating Crop Yield Densities for Counties with Missing Data," Park and his co-authors — Ardian Harri and Keith H. Coble of the Division of Agriculture, Forestry, and Veterinary Medicine at Mississippi State University — showed that 20 to 26 percent of corn yield data are missing in national surveys.

Up to 40 percent of soybean yield data are missing from surveys used by the Risk Management Agency and the National Agricultural Statistics Services, the paper added. The study was requested and funded by the Office of the Chief Economist of the USDA. His research has also been funded by several other USDA agencies.

At the Fryar Center, Park continues to research methods to measure risk in the futures and options markets. In addition to natural disasters, weeds, pests and plant diseases, agricultural producers face fluctuations in the marketplace. Futures options allow a producer to lock in a price with a buyer on their next harvest. The center can help producers make decisions with research-based information.

Park also works in the new field of precision agriculture, using data collected by harvesters to create historical yield maps. Drones and satellite imagery are also used to add layers of information.

"The more productive areas we need to input more fertilizers to maximize productivity and the less productive areas will receive less inputs for cost-effective farming," Park said. "That kind of microlevel management is the key to precision agriculture. My interest is in suggesting site-specific input management for fertilizer and seeding rates."

Compounding Challenges

The challenges for agricultural economists have compounded in recent years. In addition to global climate change, U.S.-China trade relations, the coronavirus pandemic, supply chain issues and the war in Ukraine have all created more uncertainty in the world market.

"We were worried about the climate change over the past decade, so all of our research focuses on how much climate change will impact yield in corn and soybeans," Park said. "Now, it's not just climate change, but all these other factors are also making impacts more localized than before, and that makes all of the prices increase."

"Dr. Park is one of the top young agricultural economics researchers in the field of risk management," said John Anderson, director of the Fryar Center and head of the Agricultural Economics and Agribusiness Department for the U of A System Division of Agriculture and the Dale Bumpers College of Agricultural, Food and Life Sciences. "He is helping lead the development of new analytical techniques and novel data sets to shed new light on traditional risk management problems. His work has broad application, but we are most excited to see this leading-edge research deployed on problems of interest to stakeholders right here in Arkansas."

Park conducts his research through the Arkansas Agricultural Experiment Station and outreach activities through the Cooperative Extension Service, the research and outreach arms of the Division of Agriculture. He teaches classes through the Dale Bumpers College of Agricultural, Food and Life Sciences at the U of A.

He joined the Division of Agriculture in 2021 following four years as an associate professor at Mississippi State University. He earned his agricultural economics doctorate in 2017 from Oklahoma State University following bachelor's and master's degrees in food and resource economics from Korea University.

Among his many awards for research are the Outstanding Graduate Student Paper Award in 2018 and Outstanding Contribution to Applied Risk Analysis in 2020 from the Agricultural and Applied Economics Association for papers published in the American Journal of Agricultural Economics on estimating crop yield densities for counties missing yield data.

Source : uark.edu

Video: The 15-Year Bet Behind Every New Variety!

Canada is trying to decide how much agricultural research capacity it can afford to lose. Brian Rossnagel believes the better question is whether the country can afford to rebuild it.

The longtime barley and oat breeder makes the case with a simple fact about his profession: the consequences of today’s decisions may not become visible for 10 or 15 years.

“Pick the right parents. That’s the biggest thing,” Rossnagel says. “If you pick the wrong parents, you’re not going to get anywhere—and you don’t know that until 10 years, 15 years later.”

That warning carries particular weight as Agriculture and Agri-Food Canada moves to reduce spending and streamline parts of its science operations. The department’s 2026–27 plan anticipates the loss of approximately 665 positions by 2028–29 and says some research will be reduced where capacity exists in academia or industry. AAFC says the changes will make its science operations more cost-effective over the long term.

For Canada’s seed industry, Rossnagel’s career illustrates what is at stake.

This fall, the retired University of Saskatchewan breeder will be inducted into the Canadian Agricultural Hall of Fame. During his 35-year career at the Crop Development Centre, he helped develop more than 100 barley and oat varieties, including CDC Austenson—one of Western Canada’s most widely grown feed barleys. His induction recognizes not only those varieties, but the collaboration and research system that made them possible.

Rossnagel is quick to emphasize that none of it was the work of one person.

“The first thing I thought about was all the other people who contributed to whatever success I and my program had over the years,” he says. “We know that it’s not an individual who does this. It’s a group—a team.”

That team extends well beyond the breeder whose name appears beside a variety. It includes technicians, pathologists, quality specialists, statisticians, regional testing sites, seed growers and industry partners. It also includes the breeders who came before and those who will carry the germplasm forward.

CDC Fraser barley, for example, moved through three breeding careers. Its parents came from Brian Harvey’s program. Rossnagel advanced the material after Harvey retired, and Aaron Beattie later guided it through registration and release.

That kind of handoff is normal in plant breeding. The person who makes the original cross may never see the resulting variety reach farmers.

It also explains why lost research capacity cannot simply be switched back on when budgets improve.

“If you shut it off, it’s very, very difficult—and particularly costly—to start it up again,” Rossnagel says. “If you have to start from scratch, it’s going to be at least 10 years before anybody notices whether you’re getting anything done or not.”

The concern is not simply how many experimental lines Canada can process. Modern equipment, statistical tools and genetic technologies allow today’s breeding programs to evaluate tens of thousands of lines—far more than Rossnagel could handle when he entered the field in the early 1970s.

But efficiency and automation do not generate every idea.

“If you pare back down, and instead of having six or seven individual scientists concentrating on wheat breeding, you go down and say three people could handle all this, well, that’s half the ideas gone,” he says. “Particularly if you happen to lose the three people who had the really neat and innovative ideas, boy, that’s a problem.”

It is a timely distinction for Canadian agriculture. Consolidating programs may preserve the volume of material moving through a system, at least initially. It may not preserve the diversity of thinking, regional knowledge or willingness to pursue unconventional crosses.

That regional knowledge matters because Canadian agriculture is not one uniform production environment. A variety suited to southern Alberta may face different disease, moisture and maturity pressures than one grown in Manitoba, Ontario or Atlantic Canada.

“Agriculture is applied biology,” Rossnagel says. “Biology, all around the Earth, moves from the poles to the equator. It does not move from Newfoundland to B.C. like politics do.”