Fall 2019 Newsletter

Downloadable Newsletter Version

RECORD TYPES

As you enter production into the APH report, remember to mark the record type as well as total bushels.  Each APH form will have a column for ‘Record Type’ and a list of 12 options in small print at the bottom.  You can put as many types in the column as apply to each field. The most common will likely be (A) production sold / commercial storage and (B) farm stored measured by insured.  

PRODUCTION EVIDENCE

If you are using scale tickets as production evidence, we advise you to identify the field/unit on each load.  If you are using load records out of the field and commingling in a bin with other units, we would like to have things weighed and printed if possible.

Accuracy is key to avoiding penalties when audits are triggered.  Audit reviews are rare, but can be costly if production isn’t reported within the 5% tolerance.  

WET HARVEST CONDITIONS

There are likely to be a lot of concerns with wet fields, wet roads, and wet grain.  There are a few things we can do to help you decide how to manage this fall’s harvest.

1) Finalize the field with an appraisal.  Your insurance on Corn and Soybeans ends December 10.  Any standing crop at that time must be appraised for any claim to be paid.

2) Harvest and placed in bin storage and you may apply for a 180 day extension to allow you to dry the grain and haul it to town.  This allows you to use assembly sheets rather than bin measurements. This would also require load records to separate fields

3) It is possible to file for an extension to harvest, which basically carries the liability until field conditions improve and a chance to combine arises.  It is rarely done and should not be relied upon as a final strategy. This provision cannot be approved for dry down – it can only be invoked if it is not possible or safe to run equipment.

PRICES

The harvest prices for corn and soybeans came in with a small drop from spring guarantees.  Corn started at $4.00 February average and ended up at $3.90 October average (-2.5%). Soybeans went from $9.54 to $9.25 (-3.1%). 

MARGIN PROTECTION

As agents, we still do not advise purchasing the Margin Protection Plan.  Watt’s & Associates (the firm that developed the product) says that you have to ‘keep on buying into it’ because it will pay out big one of these years.  In MN alone, they only sold 55 corn policies, 23 soybean, and 5 wheat. It is expensive, unpopular, and has yet to deliver a single indemnity payment in our area.

QUALITY ADJUSTMENTS

All production, whether it’s in a claim or not, should have quality adjustments applied.  Moisture, test weight, toxins, and other damage will reduce your production to count. If your numbers fall within the insurance charts, adjustments are made accordingly.   Anything above 15% moisture and below 49# test weight will start using insurance charts.

2019 PREMIUMS

There will be no interest charged to any multi-peril or hail accounts until February 1, 2020.  This was just announced on November 14, and should help those still trying to plan some financial decisions.  RCIS.com now accepts premium payments online. No need to login. Simply enter the statement ID and date to pay premiums securely over the web (no credit cards).

FINAL NOTE

This was a tremendously difficult year for everyone.  The consensus is that 2019 just needs to be done and behind us.  We agree with that sentiment. Going forward, we know some are looking at buying more insurance or other plans for 2020.  In some cases, that may be wise. Everyone’s farm is different which is why we try to tailor each plan to the specific situation.  We like to make decisions that control costs and provide a proper safety net. 9 out of 10 years that works for the best. It is much more beneficial to your operation to control costs wisely than to be insurance rich and depend on a claim to come out with a profit.         

Peter’s Cell   320-894-0747

*New Website*  www.haugencropins.com