Reasons for optimism about farm incomes exist for 2022. However, risks remain. This webinar discusses crop insurance, rental arrangements, and marketing for 2022. The webinar has three sections:
1. Overview of corn and soybean outlook for 2022. 2:27 minutes into webinar
2. Evaluating risk reductions associated with Revenue Protection (RP), Supplemental Coverage Option (SCO), and Enhanced Coverage Option(ECO), 16:30 minutes into webinar
Use of ECO will increase expected revenue and reduce downside risks but comes at a high premium cost. Therefore, farmers should weigh the benefits with the high premium costs. See
"Enhanced Coverage Option: Return and Risk Results." farmdoc daily February 15, 2022, [ Ссылка ]
3. Review of risk/returns of alternative leases, 41:00 minutes into webinar
Overall, both landowner and farmer returns will be above average if prices continue near current forecast levels and yields are at expected trend levels. Lower revenues can result in farmer losses, even with a crop insurance purchase at the highest coverage level, particularly for cash rent and variable cash rent arrangements. Because of higher non-land costs in 2022, typical rent factors (32% for corn and 43% for soybeans) cause variable cash rents to have lower returns than share rent and cash rent arrangements at expected crop revenues for this year. Higher non-land costs suggest that rent factors on variable leases may need adjustment. See:
"2022 Forecast Returns Under Differing Rental Arrangements." farmdoc daily , February 8, 2022, [ Ссылка ]
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Crop Insurance Tools: [ Ссылка ]
farmdoc DAILY articles on crop insurance: [ Ссылка ]
