“Stirring the Pot”: How Do Canadian Farmers Respond To Big US Crop Insurance Claims?
Last Thursday was American Thanksgiving. For those of us north of the border, it’s just another day. For the life of me, I can never figure out why we have Thanksgiving in early October. However, I’ve been coached on this and apparently Canadian Thanksgiving was once on November 6th, but in 1957 got changed to the second Monday in October.
In my part of Canada American Thanksgiving means Detroit Lions football and traveling across the border the following day to join in the shopping fun. With the Lions now 0-12, I’m not quite sure that is fun, but having been a Lion’s fan for at least 40 years, I’ve cornered the market on patience. Like we say on the farm, maybe next year.
However, my American Thanksgiving Day rituals were broken up by a keen DTN subscriber who brought up that mother lode of crop insurance payments going to American producers. If you haven’t read it click on Elizabeth Williams, “Revenue Policies Hit Pay Dirt: Windfalls Stun Crop-Revenue Policyholders”. In her article she writes,
“There’s a silver lining surrounding the collapse in commodity prices since spring: many corn and soybean growers could be in line to collect crop insurance revenue guarantees worth as much as $50 to $200 per acre with little or no yield loss, crop insurance experts say, but they need to act fast to file their claims.” (Elizabeth Williams DTN News Wed Nov 26)
I had read her piece earlier. When I read through it all my Canadian grain and oilseed indignation started boiling inside. In fact, I started rehearsing some of my lines from the 2006 farm rallies. What was that now, “all of that cheap subsidized US corn flooding across our borders, jamming our ethanol plants!” Now with our American friends getting all of this crop insurance money something didn’t seem quite right.
I’m paraphrasing here, but this is how my Canadian DTN reader responded to the news, He wrote,
” WOW!!! Just when we thought we would finally achieve a competitive level playing field with U.S. crop farmers, they hit pay dirt again!! Meanwhile, Canadian crop farmers can expect to get almost zip in competitive government support. I wonder how our farm organizations and our government will handle this issue?”
Of course I was thinking the same thing. However I’ve got a pretty good barometer of the temperature of my farmer readership and right now I’m not expecting too much. We’ve got our agricultural policy problems in this country. This latest comparison to our American friends is just one of them.
It’s difficult for me to truly understand exactly what Elizabeth was describing in her piece and the American crop insurance program in total. For instance she gave an example from a crop insurance agent, which goes as follows.
“If your proven yield is 50 bushels and you have 75 percent coverage, that’s 37.5 bushels guaranteed. But if you had CRC crop insurance, guaranteeing you $10.36 per bushel, you could collect if your yield only dropped below 48.35 bpa.” (Elizabeth Williams DTN News Wed Nov 26)
From a Canadian crop insurance/agricultural policy perspective I just don’t get it. It would seem like a license to print money. However, I’ve learned the hard way not to criticize our American friends for such policy. In fact, it is to their credit. Living on the same continent with our American friends has its challenges, but the benefits always outweigh them. However, understanding their subsidy programs is very difficult to fathom at times.
Their solution in terms of their own, for example crop insurance programs challenges us to look at ourselves to do better specifically about our own subsidy programs. However, other policies such as the relatively new Country of Origin labeling or Cool has essentially stopped Canadian hogs exports to the US bringing great damage to our industry. My recent thoughts about how the lower Canadian dollar would spur these hog exports has been turned on its ear.
So it’s obvious in Canada we have our issues. I haven’t even mentioned the Canadian Wheat Board, which my western readers always debate. Into the mix came this from a Canadian farm leader last week. In a press release, this farm leader said, “Over the last twenty years, (Canadian) farmers have generated two-thirds of a trillion dollars in gross income but have kept none of that.” It went on to say how the Canadian government had to do better for Canadian farmers.
That last bit doesn’t quite add up to me, especially since the last two years have been pretty good for grain and oilseed producers and I’m sure some farmers have kept some. However, all of these issues, whether it’s our navel gazing at American crop insurance programs, hogs backing up in Canadian pens or trillions of dollars we don’t get to keep are saying one thing. Some things within Canadian agricultural policy are still awry and we need to do better. In fact there is a lot of blame to go around.
Government certainly needs to take some blame. However, we as farmers need to acknowledge the issues among us too. At the end of the day these policy issues need to be lobbied and worked. My Canadian DTN reader was “stirring the pot.” Simply put, it needs to be stirred. Our Canadian agricultural policy world never sleeps. However, from time to time, it needs a real jump-start.