Good intent, bad policy

The National Farmers Union is calling for a full $50 an acre payment on all unseeded acres and an additional $50 an acre top-up payment. The top-up would be limited to 2,000 acres per farm.

The NFU is correct when it says that no farmer is going to receive the full $50 an acre currently available under crop insurance. While it would make sense to drop the silly 5 per cent deductible, it doesn’t make sense to ignore the seeding intensity factor, as the NFU is proposing. If you do away with that, you’ll be paying producers for land they had planned to leave fallow anyway.

As for the idea of a top-up payment of $50 an acre on up to 2,000 acres per farm, that would create many inequities. A total of $100 an acre is more than some producers are guaranteed under crop insurance when they’re able to seed a crop, particularly cereal crops. The NFU proposal would make it desirable to have unseeded land versus land that’s flooded and crops that are at a huge frost risk.

The NFU release doesn’t address the issue of producers not enrolled in crop insurance, but presumably the $50 an acre top-up would be available on all unseeded cropland, whereas land that’s seeded, but not enrolled in crop insurance would get nothing.

The NFU is correctly identifying the huge income shortfall that’s going to occur this year, but their proposed response carries all sorts of problems.

I’m Kevin Hursh.

DynAgra, an independent Western Canada-based Company, is dedicated to providing growers with the tools to manage the risk and maximize the profitability of their farm business through the continued innovation of agricultural products and services. We are committed to developing and providing growers with the latest in precision agronomics, variable rate technology, soil fertility, crop protection, fertilizers, custom application and financial solutions.