1

2015 Filing UpdateBILLINGS REGIONAL OFFICE

BILLINGS, MONTANA

PHONE: (406) 657-6447

EMAIL: RSOMT@RMA.USDA.GOVThis presentation highlights features of Risk Management Agency Programs and is not intended to be comprehensive. The information presented neither modifies or replaces terms and conditions of the basic policy, the crop provisions, or the county actuarial documents. Consult a crop insurance agent for further details.

2

3

4

Summary of Farm Bill ChangesWWW.RMA.USDA.GOV CLICK ON

5Farm Bill – Coverage by Irrigation Practice

You may have separate Enterprise Units for irrigated and non-irrigated crops

New option: You may elect separate coverage levels for irrigated and non-irrigated crops (including within a Whole Farm Unit when available)

Effective for 2015 spring seeded crops (contract change date of November 30, 2014)

See PM-14-045 and PM-14-046 for guidance

6Farm Bill – Conservation Compliance

Highly-Erodible Land (HELC) and Wetland Conservation (WC) compliance is required to be eligible for a premium subsidy AD-1026 form (HELC and WC Certification) on file with FSA by June 1,

2015 to be eligible for 2016 crop insurance premium subsidy

7Farm Bill – SCO (w/PLC coverage)

Supplemental Coverage Option (SCO) is area-based coverage for a portion of your insurance deductible Purchased in combination with a regular policy

Available 2015 for “combo” plans (Yield Protection, Revenue Protection, Revenue Protection w/Harvest Price Exclusion)

Corn, Soybeans, Wheat, Grain Sorghum, Cotton, Spring Barley and rice

65% premium subsidy

Indemnity payments based on whether the final average yield or revenue for an area falls below 86% of the expected level

8

Example:

Grower purchases an individual revenue policy, 80% coverage

9SCO Data Source and Availability (excluding cotton)

General guidelines to establish coverage for a county or district : At least 20 of the most recent 30 years reported

At least 8 of 10 most recent years with an average of 10,000 or more planted acres

At least 50 farms for the crop/county according to the most recent Census of Agriculture

Considering use of crop insurance yield data beginning with 2016 Additional counties for current SCO crops (aggregation)

Additional practice-specific insurance offers

Additional crops (primary areas)

10

11

12

13

14

15

16

17http://www.dvlpapps.rma.usda.gov/tools/RMAMobile.html

18Farm Bill – Native Sod

“Acreage that has no record of being tilled … for the production of an annual crop on or before February 7, 2014…” Applies to: Iowa, Minnesota, Montana, Nebraska, North Dakota,

and South Dakota – all counties

Effective for annual crops with a contract change date on or after June 30, 2014 When more than five acres of native sod (by policy) is tilled

Tilled and planted on or after February 7, 2014

19Farm Bill – Native Sod

Benefits reduced for first four crop years: Reduction of premium subsidy (50 percentage points)

Reduced insurance guarantee (65% of transitional yield)

No substitute yields in APH database (for low years)

Reference: 15-CCIP-Farm Bill Basic Provisions Amendment – Section 1 definition

and Section 9(e) and 9(f)

Informational Memorandum PM-14-027

20Farm Bill – Beginning Farmer and Rancher

“An individual who has not actively operated and managed a farm or ranch…with an insurable interest in a crop or livestock as an owner-operator, landlord, tenant, or sharecropper for more than five crop years…”

(exclude years: under the age of 18, in full-time military service, in post-secondary education)

Guidance: 15-CCIP-Farm Bill Basic Provisions Amendment – Section 1 definition,

Sections 3(l), 7(e)(4), 7(g) and (h), and 36(c)

PM-14-028

21Farm Bill – Beginning Farmer and Rancher

BFR benefits (beginning with crops having a June 30, 2014 contract change date and later): Increased premium subsidy (10 percentage points)

Exempt from administrative fees

Allows use of yield history from previous farm or ranch operations

Yield substitution is 80% of the applicable transitional yield (instead of 60%)

Benefits are continuous until 5 year rule is met

22Farm Bill – Whole Farm Revenue Protection

Provides protection for diversified farms (all eligible commodities under one insurance policy)

Replaces AGR and AGR-Lite / expanded availability

Coverage based on 5 consecutive tax years of historic average revenue and expenses

50-85 percent coverage levels (80 and 85 levels require 3 or more commodities)

Premium rate discounts for multiple crop diversification

Reference: MGR-14-021

23Farm Bill – Whole Farm Revenue Protection

Comparison Feature AGR-Lite WFRP

Liability Limit $1 Million $8.5 Million

Animal Limit None 35% of expected revenue up to $1 million (maximum)

Replant Payment None Up to 20% of expected revenue for annual crop with 20 acres or 20% of crop needing replant

Other Federal Crop Insurance

Optional Optional – at any buy-up level; no CAT level MPCI allowed

Market readiness amounts in insured revenue

No Yes

Expanding operations No Average historic revenue increased by10% if operation is expanding and approved by AIP

Premium Subsidy Basic Level

Whole-Farm Level w/ 2 or more commodities

24Whole Farm Revenue Protection Availability

25APH Yield Exclusion

Allows a higher approved yield for producers on eligible crops in eligible counties (and contiguous) that have been hit with severe weather Available for 2015 spring crops (not dual wheat counties)

Eligible 2015 crops are: corn, soybeans, wheat, cotton, grain sorghum, rice, barley, canola, sunflowers, peanuts and popcorn

Yield Exclusion option available when the county yield is at least 50 percent below the average of the previous 10 consecutive crop years

Must be elected by the Sales Closing Date

Reference: Section 5 in the 15-CCIP-Farm Bill Basic Provisions Amendment

26APH Yield Exclusion

You may choose any of the following options within a database: Yield Exclusion (YE)

Yield Adjustment (YA)

Trend Adjustment (TA)

You may only apply either yield exclusion or yield adjustment to an actual yield within a database

When an actual yield is excluded, the excluded actual yield cannot be considered for trend adjustment.

27APH Yield Exclusion

If APH YE lowers your actual production history to less than 4 crop years of production history in your APH database, the applicable T-Yield will be substituted for the excluded years

Written Agreements are not allowed (YE must be provided in the actuarial documents)

Personal T-Yields (ND only): When an actual yield is excluded in an APH database, that actual

yield is not excluded for the purposes of calculating the Personal T-Yield (PTY)

28APH Yield Exclusion

29

30Non-Irrigated Soybean YE Availability 2015

31Additional Information – www.rma.usda.gov

32

Summary of Filing Changes

33Rate, Reference Yield and T-Yield Reviews

Fall Crops: Alfalfa Seed

Spring Crops: Canola

Millet

Mustard

Potatoes

Safflower

Sugar Beets

34Organic

T-Yields reviewed and updated for 2015 based on additional history Canola (MT & ND) factor changed from 95% to 90%

Millet (ND) factor changed from 70% to 65%

Millet (WY) factor changed from 65% to 70%

Potatoes (MT, ND, SD, WY) factor changed from 80% to 85% (based on national data only)

New distinct organic price elections (no contract required) Grain sorghum, popcorn, flax, millet, corn silage

35New Breaking Statement

Revised Special Provisions statement in Prairie Pothole States (all counties): Iowa, Minnesota, North Dakota, South Dakota, Montana, Nebraska

Requires approved yield to be held at 65% of the T-Yield for the first four crop years of planting when breaking native sod

New yield indicator required (SP)

36Cover Crop Statements (in counties with cc and sf practices)

New statements in the Special Provisions clarify that if cover crops are grown on land during a fallow year, that the subsequent crop must be insured under the continuous cropping practice

If a crop or cover crop is planted on summerfallow acreage in a fallow year, the following planted crop will not meet the summerfallow practice definition until the acres lie fallow for a full crop year. If the acreage did not lie fallow the preceding full crop year, the acreage may be insured under the continuous cropping practice provided all other provisions of that practice are satisfied.

Guidance in CIH Para. 821B(3)(b) and Para. 911

372015 Trend Adjustment Availability

Montana Wheat: 48 of 54 program counties

Canola: 6 of 18 program counties

Corn: 10 of 24 program counties

North Dakota Wheat: 53 of 53 program counties

Canola: 38 of 53 program counties

Corn: 46 of 53 program counties

Sunflowers: 51 of 53 program counties

Soybeans: 35 of 48 program counties

382015 Trend Adjustment Availability

South Dakota Wheat: 55 of 66 program counties

Corn: 62 of 66 program counties

Grain Sorghum: 19 of 59 program counties

Sunflowers: 23 of 52 program counties

Soybeans: 46 of 48 program counties

Wyoming Corn: 7 of 11 program counties

39Trend Adjustment Participation

State Crop 2013 Policies w/TA

2014 Policies w/TA

Montana Wheat 612 602

North Dakota WheatCanolaCornSunflowersSoybeans

4,0291,0775,310

-5,632

5,8591,5495,528354

7,276

South Dakota WheatCornGrain SorghumSunflowersSoybeans

3,04118,552

113-

13,926

3,40918,492

163486

16,172

Wyoming Corn 44 96

40Whole Farm Units – Coverage Level by Practice

New SP statement – CCIP Revenue plans for Barley, Canola, Corn, Grain Sorghum, Sunflowers, Soybeans, Wheat In addition to section 34(a)(5)(i)(A)(3) of the Basic Provisions which

requires all crops within a whole-farm unit to be insured at one coverage level, you may elect separate coverage levels for all irrigated crops and all non-irrigated crops within your whole-farm unit in accordance with section 3(b)(2) of the Basic Provisions. For example, all irrigated crops may be insured at the 65 percent coverage level and all non-irrigated crops may be insured at the 70 percent coverage level.

41Annual Forage – PM-14-030

New program (North Dakota and South Dakota) in 2014 Covers annually planted crops for livestock feed and fodder which

are either mechanically harvested, grazed or a combination

Farm Bill 12305(b)(1)(B) prohibits CAT coverage for crops and grasses used for grazing New 2015 Special Provisions statement clarifies this

NAP will be offered for any annual forage crop planted with an intended purpose that includes grazing Producers cannot obtain both NAP and AF at a buy up level for the

intended use of grazing

42Alfalfa Seed

Crop Provisions revised to incorporate changes made converting the program to permanent status Crop Provisions 15-0107 replaced pilot provisions 12-0107

Updated definition to include forage seed produced as hybrid seed

43Specialty Canola, Corn, Soybeans

MGR-13-002.1 (2014 and succeeding crop years) – Separate APH databases to use contract price OR do not separate databases and do not use contract price

Specialty types affected: High Oleic Canola

High Amylase Corn

Blue Corn

Low Linolenic Acid Soybeans

44Canola – North Dakota

“No Irrigation Practice Specified” changed to “Irrigated” and “Non-irrigated” T-yields and rates were duplicated for both offers

Irrigated offers were not attached to maps

Montana offers were already split into irrigated and non-irrigated

Producers can now take advantage of separate units by irrigation practice provisions

45Corn

Non-Irrigated Grain Corn added to: Adams, ND

Perkins, Shannon, SD

Non-Irrigated Silage Corn added to: Carter, MT

Quality – low test weight Farm Bill, Section 11013 mandates additional time to settle claims for

corn with low test weight (below 44 lbs.)

Quality statement in Special Provisions revised to allow 120 days to settle claims (instead of 60 days allowed for other issues)

46Dry Beans

NOTE: As in 2014… Montana, South Dakota, and Wyoming have only the APH plan

North Dakota has YP, RP, and RP w/HPE plans

Cranberry type added to Pembina and Walsh, ND

Tebo type added to Barnes, Steele and Walsh, ND

Enterprise units now available (all plans)

Contract Price option for certified organic practice now available for YP, RP and RP w/HPE plans (only APH had this option in 2014)

47Dry Beans – New Variety Statements

Tebo (new type in the region) Approved Tebo Varieties include: Fuji and Hime. Varieties not

approved above will be insurable only by written agreement.

Cranberry (Etna added) Approved Cranberry Varieties include: Capri, Cran 09, Cran 34, Cran

74, Etna, Hooter, Messina, and Taylor Hort. Varieties not approved above will be insurable only by written agreement

48Dry Peas

NOTE: As in 2014… North Dakota and Montana have YP, RP, and RP w/HPE Plans

South Dakota and Wyoming have APH Plan only

Program Expansion to Laramie County WY Smooth Green or Yellow type only (both irrigated and non-irrigated)

Dates: 3/15 Earliest Planting and Sales Closing, 4/30 Final Planting, 7/15 Acreage Reporting

Enterprise units now available for all plans

Contract Price option now available for YP, RP and RP w/HPE plans for certified organic practice (only APH had this option in 2014)

49Dry Peas

“No Irrigation Practice Specified” changed to “Irrigated” and “Non-irrigated” T-yields and rates were duplicated for both offers

Irrigated offers were not attached to maps

Producers can now take advantage of separate units by irrigation practice provisions

50Dry Peas – New Chickpea Variety Statements

Approved Large Kabuli Chickpea Varieties:

Dwelley

Dylan

Sierra

Troy

Xena

Yuma

Varieties not listed above will be insured as the Small Kabuli Chickpea type unless designated otherwise by written agreement.

Approved Small Kabuli Chickpea Varieties:

Alma,

Amit (B-90)

Chi Chi

Chico

Frontier

Luna and other Kabuli Chickpea varieties not otherwise designated.

51Dry Peas – New Rotation Statement

Spring Austrian Peas, Spring Forage/Feed Peas grown for seed, Spring Smooth Green or Yellow types: Insurance will not attach to any acreage on which field peas (Austrian

Peas, Forage/Feed Peas Grown for Seed and/or Smooth Green or Yellow Peas) were planted in either of the previous two (2) crop years or on which chickpeas or lentils were planted in the previous crop year. Chickpeas that were planted and then all plant growth is terminated by chemical or mechanical means prior to June 15, will not be considered planted for rotational purposes only. The insured is responsible to provide proof of insurability. This statement applies to field peas, lentils, and chickpeas grown either as a grain, cover crop or in a cover crop mixture.

52Dry Peas – New Rotation Statement

Spring Lentil type: Insurance will not attach to any acreage on which lentils were

planted in either of the previous two (2) crop years or on which chickpeas or field peas were planted in the previous crop year. Chickpeas that were planted and then all plant growth is terminated by chemical or mechanical means prior to June 15, will not be considered planted for rotational purposes only. The insured is responsible to provide proof of insurability. This statement applies to lentils, field peas, and chickpeas grown either as a grain, cover crop or in a cover crop mixture.

53Dry Peas – New Rotation Statement

Chickpea types: Insurance will not attach to any acreage on which chickpeas

(garbanzo beans) have been planted in any of the three previous crop years. Chickpeas that were planted and then all plant growth is terminated by chemical or mechanical means prior to June 15, will not be considered planted for rotational purposes only. The insured is responsible to provide proof of insurability. This statement applies to chickpeas grown either as a grain, cover crop or in a cover crop mixture.

54Livestock

New “Margin Protection Program for Dairy” (MPP-Dairy) Administered by FSA

Available September 1, 2014

CAT and buy-up coverage offered

Producers may not participate in both MPP-Dairy and LGM-Dairy

More information in MGR-14-005

55Potatoes – North Dakota

Added Processing Quality (PR) option to 17 counties:

Barnes, Benson, Cass, Cavalier, Dickey, Eddy, Emmons, LaMoure, McLean, Mercer, Morton, Pembina, Ramsey, Ransom, Richland, Steele, Stutsman

Fresh varieties (Russet Norking and Russet Norkotah) are not eligible

Contract price now available for certified organic practice

Two potato maps were changed: Grand Forks and Pembina Rate areas no longer apply; unrated areas do apply

Two rate area potato maps were deleted: Traill and Walsh counties

56Soybean Program Expansion

3 North Dakota counties: Divide, Grant, Stark All types and practices

6/10 Final Planting Date

South Dakota “Non-Conventional”

Now NC-Irrigated and

NC-Non-irrigated

57Wheat, Oats, Barley

New Special Provisions statement to conform to Section 1206 of the Farm Bill (all plans)

In addition to Section 29 of the Basic Provisions, if you elect to obtain a Farm Service Agency Graze-Out Payment for acres of this crop grazed by livestock and not otherwise harvested, you are not eligible for an indemnity.

58Map Updates (all in North Dakota)

Incorporated high rate areas into adjacent standard rate areas: Burke, Ransom, Richland, and Sargent Counties

Incorporated unrated areas into adjacent rated areas: Pembina

Cleaned split fields: Dickey, Nelson, Sioux

Deleted potato rate area maps: Grand Forks, Pembina, Traill, Walsh

59Farm Bill – CAT Premium Change

Finding: CAT experience is generally better than it is rated

Action: 2015 CAT rating differential has been reduced (by 50% in most cases)

Producer payment remains $300 administrative fee

602014 Harvest Prices AnnouncedCommodity Harvest Price Change Projected

Price

Barley $3.16/bushel ▼21.6% $4.03/bushel

Canola $0.168/pound ▼8.6% $0.184/pound

Canola, Rapeseed $0.223/pound ► $0.223/pound

Corn $3.49/bushel ▼24.5% $4.62/bushel

Corn, Organic $6.77/bushel ▼24.5% $8.97/bushel

Grain Sorghum $3.37/bushel ▼24.4% $4.46/bushel

Popcorn $0.1487/pound ▼24.4% $0.1968/pound

Soybeans $9.65/bushel ▼15% $11.36/bushel

Soybeans, Organic $16.24/bushel ▼15% $19.12/bushel

Sunflowers, Oil $0.174/pound ▼16.7% $0.209/pound

Sunflowers, Confectionery $0.239/pound ▼12.8% $0.274/pound

Wheat, Spring $6.17/bushel ▼5.2% $6.51/bushel

Wheat, Durum $6.87/bushel ▼5.2% $7.25/bushel

61ARPI Popcorn (South Dakota)

ARPI Plans 04, 05, and 06 CCIP Plans 01, 02, and 03

62ARPI Popcorn (South Dakota)

ARPI Popcorn FPD – 6/14 Different than corn (5/25 or 5/31) or popcorn (5/20)

Same as ARPI corn

Consistent with the practices of the industry, insured acreage must be covered under a contract with a popcorn buyer

Expected and final county yields/revenues are determined by NASS data (corn multiplied by a factor)

63ARPI – Wheat, Corn, Soybeans (+ Popcorn)

New Special Provisions statement clarifying the protection factor for CAT coverage: In lieu of section 6(b) of the Basic Provisions, you may only choose a

protection factor of 120 percent for catastrophic risk protection. However, in accordance with section 8(m) of the Basic Provisions, if you do not submit a production report to us by the production reporting date specified in the actuarial documents, your protection factor for your catastrophic risk protection policy in the following crop year will be limited to the lowest protection factor available. The provisions of section 5(d)(1) of the Basic Provisions are also applicable for catastrophic risk protection on native sod acreage.

64Written Agreements Complete the request form completely – including:

Farm, Tract and Field #s

Crops, types and practices (specific to those offered in county actuarial documents)

Any narrative sections – use attachments if needed

Better to provide too much information rather than not enough

Write clearly – unreadable information causes delays

Review Written Agreement Handbook for specific WA type and submit all required information – missing information causes delays Exhibit 5 of the WAH is an excellent reference

Maps need to be readable – very large % are inadequate

2015 signed APH (or signed 2014 production report & unsigned 2015 APH) is always required.

65Top 10 South Dakota Insured Crops in 2013(by planted acres)

66CY 2013Loss Ratios - Corn

67CY 2013Loss Ratios - Soybeans

68CY 2013Loss Ratios - Wheat

69CY 2013Loss Ratios - Sunflowers

70CY 2013 Loss Ratios - PRF

71

Questions?RSOMT@RMA.USDA.GOV