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What about when crops fail or fall short, what do farmers do?
by hattmall 4y ago
What about when crops fail or fall short, what do farmers do?
- cwillu 4y agoThere's an extensive selection of insurance policies. A selection of on set of policies by one provider in Saskatchewan (granted, not the US) can be found at https://www.scic.ca/crop-insurance/program-overview/multi-peril https://www.scic.ca/crop-insurance/program-overview/multi-pe...
- bluGill 4y agoGenerally you hedge only about 70% of the expected crop, and then place insurance on that 70%. In a bad year you break even, and you get all the excess in a good year.. also the hedging is not all at once. Farmers are already selling contracts for their 2023 corn crop, but typically only 10% right now. They will contract more and more out over time has harvest grows closer. You have a good idea what you harvest for your 2022 crop by now, so you can contract closer to 100% if you can find a buyer.