Many hemp producers will be eligible for multi-peril crop insurance this year, and other growers could qualify for Noninsured Crop Disaster Assistance Program that provides aid to growers who don't have access to conventional crop insurance, the Agriculture Department announced Wednesday.
USDA had already made hemp eligible for coverage under whole-farm revenue policies. Hemp producers still won’t be eligible for revenue insurance policies on hemp alone.
Separately, USDA officials told reporters Thursday that the department is studying 4,600 comments on an interim final rule issued last October to regulate production of hemp. Bruce Summer, administrator of the Agriculture Marketing Service, said the agency didn't have the legal authority to raise the 0.3% limit on the THC content of industrial hemp or delay the October deadline for producers to be in compliance with the 2018 farm bill requirements.
However, he acknowledged that there were concerns about whether there are enough eligible laboratories available for producers to have their crops tested for THC levels within 15 days before harvest. "It’s something we have heard loud and clear and that we are dealing with," he said.
He said AMS would take another round of comment after the 2020 growing season.
The multi-peril policies, which are being made available on a pilot basis, provide coverage only for reduced yields. Prevented planting is not covered.
The policies will be available in certain counties in Alabama, California, Colorado, Illinois, Indiana, Kansas, Kentucky, Maine, Michigan, Minnesota, Montana, New Mexico, New York, North Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, Tennessee, Virginia and Wisconsin.
THC levels above the level allowed by USDA, 0.3%, are an uninsurable loss, and the crop can’t be counted in calculating the grower’s production history.
The deadline for signup is March 16.
To be eligible for coverage, a grower must have at least one year of history producing hemp and have a contract for the sale of the insured crop this year. Coverage also will be limited to crops grown on at least five acres for cannabidiol oil (CBD) or 20 acres for grain and fiber.
“Hemp offers new economic opportunities for our farmers, and they are anxious for a way to protect their product in the event of a natural disaster,” said Bill Northey, USDA’s undersecretary for farm production and conservation.
Northey told reporters that the department would eventually evaluate the possibility of offering revenue insurance for hemp once there is sufficient data available on prices and yields. He did not provide a timetable.
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Beginning in 2021, hemp that is grown in containers will be insurable under the nursery crop insurance program and the Nursery Value Select pilot crop insurance program.
Basic NAP coverage will be available for a fee at 55 percent of the average market price for crop losses that exceed 50 percent of expected production. For a premium, buy-up coverage is available for up to 65% of expected coverage.
For all coverage levels, there is a NAP service fee of $325 per crop or $825 per producer per county, not to exceed $1,950 for a producer with farming interests in multiple counties.
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