With soil moisture levels improving, it might look simple enough for farmers who’ve lost a wheat crop to freeze damage to turn around and plant a summer crop instead.
Not so fast, the experts say. Farm management decisions are anything but simple these days.
With the most complex farm bill in history still in the implementation stage, one of the biggest concerns is making sure farmers don’t ruin their chances of getting a disaster payment later, said Brenda Sidwell, a crop insurance agent from Goltry, Okla.
The farm bill includes for the first time the Supplemental Revenue Assurance program, or SURE, a new form of crop disaster relief that only pays off if a farm meets a loss trigger and only if the producer is insured on every crop they plant. With crop insurance closing dates already in the rearview mirror, farmers who make a sudden change of plans and plant a noninsured crop could end up forfeiting a potentially sizeable disaster payment, Sidwell says.
“SURE eligibility is complicating everything,” she said.
SURE rules have not been published yet, so the benefit level is uncertain. Those benefits would also not be paid until sometime in 2010, which could create cash flow problems for farmers who need the money sooner.
Farmers need to understand how all of the complex programs interact and how their decisions now might affect future program payments, insurance, disaster aid and profit margins.
“That’s a bigger problem for our producers then keeping track of the chemical use,” said Charles Meier, a certified crop advisor with the Garber, Okla., Co-op. “I’m kind of surprised somebody hasn’t started a service to help farmers understand all of this. I farm as well but I try not to advise anybody on that stuff.”
While farmers will need to consider any chemical carryover issues before planting another crop, Meier said both commercial applicators and farmers with their own rigs keep detailed records of the products they use for at least two years and are adept at managing crop rotations.
“In our area, everybody’s looking at corn, soybeans and sorghum” for replanting, he said. Other options under consideration across the state are sunflowers and sesame. But a full assessment of damage is still two or three weeks away on some fields, Meier says. Sixty percent of the Oklahoma wheat crop is now rated in poor to very poor condition.
Paul Campbell, a branch manager for the Plains Partners Co-operative in Central Oklahoma, said farmers who applied high-priced fertilizer last fall to feed a wheat crop they won’t harvest might feel like they have to replant.
“They’ve got that input in the soil, and they need to utilize it in some way,” he said.
Jeff Bedwell, Garfield County ag extension agent, says Oklahoma State University specialists have been hosting informational meetings at grain elevators around the region with more meetings planned for early May. In addition to information about secondary crop options and their agronomics, experts are discussing qualifications for farm program participation and issues with obtaining insurance, he says.
Farmers should explore all of the options, but Bedwell says they need to be prudent and cautious when it comes to planting a second crop.
“We got some decent moisture here recently but we’re not overloaded with soil moisture,” he said. “There’s more risk with a summer crop, more what-ifs on moisture and temperature. Can they get insurance coverage? Can they get seed? Some seed supplies could get short. What about pre-emergence herbicides? Are they going to be available? What’s going to be available and what’s it going to cost? They might find they want to sit this one out.”
He said one option that might look more attractive these days is grazing out the wheat, as cattle prices have improved.
Rodney Jones, OSU northwest area economist, said a crop disaster could influence not only whether SURE payments are triggered but also the likelihood of collecting a payment under the new ACRE, or average crop revenue election program.
Farmers need to decide whether to stay with the traditional crop payment program or switch to ACRE by Aug. 15. For them to qualify for an ACRE payment, state revenue must fall below a certain benchmark.
“I think we’re becoming more and more certain the wheat yield in ’09 will fall below the benchmark,” he said. It looks like the weighted average price for the year will also be lower. ACRE is a whole farm program and will have a benchmark trigger on each different crop grown.
Jones said the question will be whether farmers will get a big enough ACRE payment to more than offset what they would have made over the next four years under the traditional plan. The ACRE program is likely to trigger only once, or maybe at the most, twice, over that time period.
“They are doing a disservice to themselves if they don’t at least run the numbers. It’s looking more and more like a viable alternative,” he said. OSU is working on a calculator that will compare the payment plans.
Sidwell is hopeful farmers will get the option to replant a noninsured crop and still collect their SURE payment under something called a “ghost crop” provision. That would mean the crop would not count toward or against a future SURE payment. But it’s not yet clear whether that designation would apply in all situations, according to the state’s Farm Service Agency which is awaiting the appointment of a new official state director.
At issue is whether a commodity can be grown as a “ghost crop” when it has already been designated as routine under double-cropping situations, as is the case with grain sorghum in Garfield County, Jones said. Farmers, not anticipating a wheat disaster, may not have signed up to insure a sorghum crop by the sales closing date. The Farm Service Agency re-opened a late SURE buy-in on the national level for the 2008 crop year but there is no indication it will consider such a move for 2009.
All of these contributing factors mean recovering from the freeze will be difficult for many.
“We’ve got a real crisis on our hands,” Sidwell said. “A lot of people are still in denial. But this could really shakeout some farmers.”
Enid, Okla. —
