WASHINGTON (B)--United States Department of Agriculture estimated it will have to pay out about $2.155 billion in insurance indemnities for crop losses so far in 2000. But government officials stressed that total will surely rise significantly over the next few months. USDA's Risk Management Agency paid out $2.415 billion for 1999 crop loss claims.
One USDA official said he expected crop insurance indemnities this year to meet or surpass the level of payments in 1999, a year when Congress approved $1.2 billion direct crop disaster payments for producers whose crops suffered from weather-related damage.
According to USDA data obtained by BridgeNews, farmers in Texas, a state hit hard by dry weather this year, are so far estimated to receive about $373 million in insurance payments for crop losses. That is about $57 million more than USDA received in premiums for its 2000 policy coverage. It is also a clear sign that crop damage is significant there, a USDA official said.
There is no question in the minds of local USDA officials in North Dakota--where farmers produce mainly wheat, barley, corn and soybeans--that weather-related disasters are severe.
"We have been hit with a little bit of everything," said Dale Ihry, a local Farm Service Agency official. He said farmers were hurt early on by dry weather, then slammed later by torrential rains.
According to USDA's preliminary estimates, North Dakota farmers will be indemnified with a total $281 million, significantly higher than the $171 million in premiums collected for the 2000 crops.
Nebraska is another state with steep insurance claims and serious drought problems, according to local FSA officials and USDA numbers.
"Nebraska has been sending a lot of letters to Washington, D.C., asking for agriculture disaster declarations," an FSA aide told BridgeNews over the phone. "Farmers have been hit hard here by drought."
The situation in Nebraska is reflected by the estimated $122 million in government crop insurance payments USDA already believes it will have to make for farmers there.
The next scheduled revision of RMA insurance claim totals is Sept. 19, when the agency is planning to add the data to its Web site.
Insurance claims from farms are a key indicator used by USDA in figuring out how much disaster relief aid is needed, according to government agronomists. But if USDA or the Office of Management and Budget have any estimates for how much they would like to see Congress give to producers, they are not saying.
Of course there is also plenty of other evidence that weather problems have plagued farmers from New York to Kansas, to Idaho to Texas, to Oklahoma to Arizona. Those states and more are chock full of counties that USDA Secretary Dan Glickman has declared disaster areas thanks to drought, flooding and even wildfires.
Furthermore, USDA's National Agricultural Statistics Service said talk of crop abandonment in Alabama, Arkansas, Colorado, Georgia, Kansas, Louisiana, Mississippi, Missouri, Nebraska, New Mexico, Oklahoma and Texas is so prevalent USDA will release a special crop yield survey in October.
Congress approved $1.2 billion in aid specifically for weather-related crop disasters suffered in 1999, but there is just $450 million reserved for crop disaster losses in 2000 in the Senate version of the fiscal 2001 farm budget bill. That bill is still languishing on Capitol Hill without enough conferees to move it. The House has no money reserved for weather disaster relief in its version of the bill.