Government

Should there be a 'good farmer' discount for cover crops? Iowa demo program could gather data

Iowa demonstration program could gather data to show reduced risk

Jeremiah Sabourin, a hired helper on the farm, drives the grain cart as Jake Pedersen drives the harvester Nov. 5 on his 2,200 acres in West Branch. Pedersen has been growing offseason cover crops for six years. (Andy Abeyta/The Gazette)
Jeremiah Sabourin, a hired helper on the farm, drives the grain cart as Jake Pedersen drives the harvester Nov. 5 on his 2,200 acres in West Branch. Pedersen has been growing offseason cover crops for six years. (Andy Abeyta/The Gazette)
/

If good drivers get a discount on car insurance, why can’t good farmers get a break on crop insurance?

Conservationists who support this idea say farmers who grow cover crops — offseason grains shown to reduce erosion and fertilizer runoff into streams and lakes — should get discounted crop insurance because cover crops reduce the risk of flooding and improve water quality.

“It’s taking a different look at crop insurance that’s never been done before,” said Kristopher Reynolds, Midwest deputy director for the American Farmland Trust, a national conservation agriculture group. “We’ve never coupled conservation and risk management.”

But there’s little proof that cover crops reduce the likelihood insurers would have to pay out for crops lost due to floods, hail or drought. That’s where a three-year, $3 million Iowa demonstration project comes in.

In 2017, the Iowa Department of Agriculture and Land Stewardship announced it would offer farmers $5 an acre to grow cover crops. Although smaller than $25-per-acre grants for first-time cover crop growers, the $5-an-acre incentive is significant because it’s about one-third of a farmer’s crop insurance premium, which ranges from $13 to $15 per acre.

It’s more of a subsidy than a true crop insurance discount. But more acres regularly planted in cover crops means more data on losses that require insurance payouts. If researchers can show land with cover crops has less risk, then that could persuade the U.S. Department of Agriculture to provide an actual discount.

“If they can compare that and can show they had less of a loss with those with cover crops, that would help us figure out how that would be rated,” Bill Northey, U.S. undersecretary for farm production and conservation and former Iowa agriculture secretary, told The Gazette. “The most important piece is reducing the risk.”

How they work

Farmers plant cover crops not to glean a harvest, but to protect soil from erosion, break up compacted soil and absorb nitrate and phosphorus. The cover crop — usually rye — is killed off with herbicide before the spring planting of corn and soybeans.

ARTICLE CONTINUES BELOW ADVERTISEMENT

Scientists estimate rye or oats grown as a cover crop during the offseason could reduce by 30 percent nitrate and phosphorus washing from Iowa farm fields into streams and rivers.

Steve Berger, a Wellman farmer, has grown cover crops on his 2,000-plus acres since the 1990s. As a result, his soil has more organic matter, which has translated into higher corn yields, Berger told The Gazette in 2017. Nitrate concentrations leaving his drainage lines are lower than surrounding fields and the statewide average, he has said.

How many acres?

In 2017, the first year of the $5-per-acre demonstration project, there were 168,708 acres funded and $843,540 spent. That fell to 135,266 acres and $676,300 in 2018.

Advocates for the program fear 2019 will have even lower participation because of the weather.

Spring rains delayed planting and then snow in October has meant a slow harvest. The number of acres planted in cover crops likely will depend on decent weather for the next month.

The 2017 Census of Agriculture reported Iowans planted a total of 973,000 acres of cover crops that year — more than double the 379,600 acres recorded in 2012. But it’s still just 4 percent of total corn and soybean acres.

Iowa’s Nutrient Reduction Strategy says the state needs 60 percent of these acres in cover crops, along with the use of other conservation practices, to meet goals for reducing nitrate and phosphorus runoff.

Trial and error

Jake Pedersen of West Branch has been growing cover crops for six years, using trial and error to find the best system for his 2,200 acres.

He started with the $25-per-acre cost share and, since 2017, has received the $5-per-acre incentive through his crop insurance. He also participates in a program in which he sells soybeans to Cargill, which provides a per-acre incentive if the beans were produced in conjunction with cover crops.

“These programs have been pretty integral in keeping us committed to figuring out how to making it work,” he said.

Pedersen is hoping he’ll see soil benefits if he consistently plants cover crops for 10 to 15 years.

ARTICLE CONTINUES BELOW ADVERTISEMENT

“Erosion control, we’ve seen that right away,” Pedersen said. In past springs, during heavy rainfalls, the land planted with cover crops had less water draining off, and the water that did come off the fields was clearer — which mean less eroded soil.

“My family has been farming here for generations,” he said. “To know we’re doing everything we can to hold the soil in place or maybe even improve the soil is a big plus.”

Proving it works

Up to 90 percent of Iowans growing corn and soybeans have crop insurance, which is regulated and subsidized by the USDA. Northey, who sits on the Federal Crop Insurance Corporation, said there are hurdles to proving cover crops reduce risk and are entitled to a discount.

For one, Iowa lawmakers prohibit the state Agriculture Department from releasing the names of farmers who get subsidies for water quality measures, so it’s hard for researchers to follow up with farmers to see how these practices worked.

Northey said the USDA wants to collect and provide information to researchers, while protecting farmers’ confidentiality.

“We have good information to make sure people are compliant,” he said. Now “we’ve got to find ways to put this (data) together to get more information for researchers without putting producers’ information at risk.”

The USDA also would need a way to prove farmers really are planting cover crops in order to get a discount.

“How do we make sure of that cover crop use?” he asked. “With yields, we’ll send an adjuster out. It can be done, but there’s a lot of versions that need to happen.”

Northey favors keeping the existing system, in which farmers get a risk rating based on 10 years of data on payouts on their land. If they can reduce their risk rating by planting cover crops or using some other conservation practice, they could see costs go down.

ARTICLE CONTINUES BELOW ADVERTISEMENT

“The best of both worlds is to look at the risk that producer has and rate off the reliability of that yield, as opposed to the practices,” he said.

Iowa farmers not receiving other cover crop subsidies may apply for the $5-per-acre crop insurance incentive at apply.cleanwateriowa.org through Jan. 15.

Comments: (319) 339-3157; erin.jordan@thegazette.com

Give us feedback

We value your trust and work hard to provide fair, accurate coverage. If you have found an error or omission in our reporting, tell us here.

Or if you have a story idea we should look into? Tell us here.

Give us feedback

We value your trust and work hard to provide fair, accurate coverage. If you have found an error or omission in our reporting, tell us here.

Or if you have a story idea we should look into? Tell us here.