The upcoming deadline is March 16 for producers to elect which crop insurance policy they will take this year. This year the spring price for corn will be $4.04 for corn and $8.80 for soybeans. This means that I will be guaranteed a percentage of my yield multiplied by the spring price.
For example, I will take 85% CRC insurance on each one of my farms. If I have a farm with a five year yield average of 185 then I will be guaranteed 157 (85%) bushels per acre multiplied by $4.04. This gives me a revenue of $634 per acre.
If the price rises this fall then I will have a higher price level guarantee. If the price drops then it will trigger a revenue loss. The fall price is determined by taking the average December 2009 Chicago Board of Trade futures price during the month of October. This decision can be complex at times due to the other products that are available and the price change from year to year. However, it still allows us the ability to manage our risk and stay in business.
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