Crop Insurance Indispensable Marketing Tool
April 25th, 2007 by David Graves
The modern crop insurance program is an indispensable marketing tool. Crop insurance often offers the courage producers need to market in advance of production as well as harvest. Today, it is more common place than ever, and the practice continues growing rapidly, for farm advisors to explore with producers how crop insurance offers the opportunity to more aggressively market, especially in times of high prices, extracting profits from markets, while they are available, in order to better control their financial destiny. With this courage, producers can extract profits from the market place at no cost to the Government. The importance of crop insurance in marketing farm commodities today cannot be over emphasized, and if the program continues to grow, marketing assistance will become an even greater benefit in the future. Without crop insurance, farmers would be less likely to implement marketing strategies which allows farmers to take advantage of price increases that occur during the growing season.
The biggest reason farmers have not taken advantage of high prices that have been available in past growing seasons is the fear of not being able to satisfy the terms and conditions of any associated contract. Crop insurance, as we know it today, provides replacement-cost coverage that allows farmers to act on marketing opportunities. Increased numbers of farmers using marketing tools is a strong indication that, as a group, they are gaining confidence in making money from the market rather than their crop insurance policy.