Kelvin Leibold, Farm Management Field Specialist, Central
The profit margins in crop production have continued to decline because of rising input costs. Crop producers need to know how to integrate net worth, crop insurance and marketing into their crop marketing strategy and the type of insurance to purchase. Not only do producers need help making these decisions, but also the insurance sales providers and the lenders need assistance in integrating these three components into the decision making process.
William Edwards, Craig Chase and I wrote a grant for $25,000 to develop materials and cover the expenses of providing education on this topic. Programs were held in SW Iowa, Story County and Blackhawk County. The participants worked at laptop computers using spreadsheets that had been developed to show how net worth, crop insurance and market plans are linked together.
Forty eight people participated including lenders, insurance sales agents and producers. Other programs are being planned along with training for other farm management field staff. When participants were asked what they learned responses included: Value of forward contracting; also consider the use of options more, Spread sheets should be useful, Need to take time to work with own information. Clarify some financial aspects, Integrating marketing and insurance, Downside risk protection with the CRC/RA insurance products, Look at the cash flow spreadsheet to see where I am at for break-even and other numbers, Figuring break even and seeing how to market grain to cover cash flow and using Federal crop to protect income, Show my insureds how marketing and crop insurance can work together, Loved working all three factors on computer, Crop Insurance Options.
March 18, 2006
104 - Agricultural Risk and Financial Management
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July 8, 2006
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