Lawmakers wrestling with how to compensate citrus growers and other producers for hurricane-related losses are considering creating a temporary revenue protection program or providing grants to states to distribute to farms.
The chairman of the House Agriculture Appropriations Subcommittee, Robert Aderholt, R-Ala., raised the two options at a hearing Wednesday on agricultural damages from hurricanes Harvey, Irma and Maria.
Aderholt said he was seeking to take a “methodical approach” to assessing the uncompensated damages in the affected states, plus Puerto Rico and the U.S. Virgin Islands. “It’s still too early to finalize the actual damage that has been done,” he said.
One of the ideas Aderholt is considering is providing the assistance through a program modeled after the 2014 farm bill’s Agriculture Risk Coverage or Price Loss Coverage program.
Florida’s citrus industry is lobbying to get aid included in the next round of disaster assistance that Congress is considering, and several growers attended the hearing.
Citrus growers “have been divested by this storm. they are at the end of their rope,” subcommittee member Tom Rooney, R-Fla., told USDA’s chief economist, Rob Johansson.
Johansson told the subcommittee that crop losses from the three hurricanes are currently estimated at $2.2 billion. About a quarter of that damage, or $470 million, would be covered by crop insurance, he said.
Florida has the largest total losses so far, at $895 million, followed by Georgia at $650 million, Puerto Rico at $330 million, Texas at $306 million and Louisiana at $13 million.
While many Florida citrus growers purchased crop insurance, they largely opted for catastrophic policies that cost just $300, he said. Those policies cover 55 percent of the losses to growers when they lose at least 50 pct of their corp. “For that to pay out you need an enormous loss,” Johansson said.
He said growers consider buyup coverage worth the cost in part because of the declining yields due to citrus greening disease. “The margins on citrus growers are getting very tight,” he said. “A lot of producers are having a hard time making ends meet."
Georgia pecan growers, who lost many trees to Irma, were largely uninsured. Only about 11 crop insurance policies were sold this year for pecans, Johansson said, adding that gowers considered the new product too expensive. He said premiums could fall as the USDA obtains better data for pricing the policies.
Johansson told Aderholt that USDA could operate either type of disaster assistance program he was considering, either a revenue protection plan or state block grants.
Johansson cautioned that setting up an ARC-type program would require developing five-year averages for both prices and yields.