Weblog for Agricultural Risk Management

A new type of crop insurance has been added to the Risk Management Agency list recently, which will provide protection against declines in a dairy farmer's gross margin (the difference between the market value of milk and feed costs). Expected and Actual gross margin numbers are calculated using futures prices (never based on farmer's actual sales or expenses) and if the actual gross margin is less than the expected gross margin, the farmer will receive an indemnity payment.

Check out this Presentationto learn more.

Posted by Jericho Bicknell at 3:48 PM | Permalink | Comments (0) | TrackBacks (0)

Cornell Waste Management Institute recently conducted a study looking at the use of dairy manure solids as bedding material in terms of the impact on herd health and farm economics. With sawdust bedding getting harder to find and more expensive, many dairy farms have been looking for alternatives. I have heard of some people finding success using shredded newspaper, some replacing half of their sawdust with lime. But there has been a lot of interest recently (especially with more farmers installing anaerobic digesters which produce digested dairy manure solids as a byproduct) in using the separated solids from dairy manure as a bedding alternative. It's pretty dry, doesn't smell bad, and looks a lot like TMR...Why not?
Of course, the rather large looming question is: "Will DMS have higher levels of bacteria than other forms of bedding which will increase the likelihood of infection in my herd?"
Well that is what Cornell Waste Management Institute set out to discover. In addition, they took a look at the costs associated with DMS bedding and also the savings. They are currently still analyzing the results of the herd health component (Click here for updates), but have completed the economic analysis and found that the five farms participating in the economic portion of the study saved an average of $37,000 per year! Check out this article in "The Manager" for more information.

Posted by Jericho Bicknell at 12:50 PM | Permalink | Comments (0) | TrackBacks (0)

As I am sure most of you have heard, last weeks flooding hit a number of big corn and soybean producing states in the midwest pretty hard. In Iowa, 1.3 million acres of corn and 2 million acres of soy (20% of the state's crop) were completely destroyed according to an article in Reuters. The American Farm Bureau Federation has estimated that there has been $8 billion worth of crop damage in the midwest as a whole due to these rains.

All of this news has had me thinking a lot about the farmers out there and hoping that they all had some seriously good risk management plans in place. The thought of "how could anyone really be prepared for something like this?" did cross my mind, but after the Iowa flooding of 1993 and recent climate change reports suggesting that we should expect more extreme weather events in the future, perhaps there is no excuse for lack of preparedness.

It turns out that in 2007, 89% of both corn and soybean acreage in Iowa was covered by crop insurance. If those farmers had already planted their crops this year, they are probably calling up their insurance agents to file a claim. Depending on the level of coverage that they had though, they may only receive an indemnity payment worth half of what they would normally make. Though this is certainly better than nothing, one can only hope that there are other farm products not destroyed by the floods, or off-farm income to help offset the loss.

Some farmers who had not yet finished planting and have a prevented planting provision on their crop insurance now have to make the decision to try planting again in hopes that the bulk of the rains have stopped, or choose the prevented planting option. It is a choice between receiving 60% of their total insurance coverage liability (with prevented planting) and not planting the crop that year, or planting and having their insurance coverage reduced 1% for each day after the final planting date that the crop is planted. So as I understand this (and please someone correct me if I am wrong) if 60% x current coverage level > current coverage level - (1% x #days after final planting date) then if there is a good chance that a planted crop will get completely destroyed it makes the most sense for a farmer to take the prevented planting provision. How confusing. For further explanation click here.

For corn, the opportunity to plant again may have passed because at this point the ears may not mature before first frost. However, for soybeans there is still a possibility for planting and harvesting a crop. Jeff Caldwell, an Agriculture Online News and Features Editor talks with a farmer who says that with soybean prices being high it is appealling to try for planting. But who knows what the beginning of July will bring.

For more information on prevented planting provisions due to excess moisture or flood check out this presentation.

Posted by Jericho Bicknell at 10:36 AM | Permalink | Comments (0) | TrackBacks (0)

With the high cost of energy these days, there are those who are looking to reduce some of the risk of further cost increases by producing their own fuel. For John Williamson at Stateline Farm in Shaftsbury, VT, this fuels production starts in the field with the planting of oilseed crops such as sunflowers and canola, and ends in the barn housing his biodiesel processing equipment.

On June 3rd, producers, extension faculty and staff, community members, and more gathered at Stateline Farm for an On Farm Biodiesel Workshop. In the morning session, Matt Rudolf and Tim Angert from Peidmont Biofuels, a North Carolina biodiesel education organization, taught a hands-on biodiesel making class. This was followed in the afternoon by a tour of the biodiesel facility and process happening right there at Stateline Farm. Here are some snapshots from the day:

Here's where it all begins...
Extension Assistant Professor Heather Darby discusses the different oilseed crops that they are growing at Stateline Farm.
Check out the research that UVM has been doing for more info on crop types, costs, etc.: Alternatives for On-Farm Energy Enhancement in Vermont:Oilseed for Feed and Fuel

Harvested Seed

Getting out that oil!!
We got to look at two of the oilseed press options: Chinese and European. Both have pros and cons. The Chinese model is more affordable but may require some modifications and supervision. The European model is more expensive and a bit slower, but doesn't require as much fiddling with after purchase. I will try to get a link up here soon to more information. For now you could try contacting:

Vermont Biofuels Association
P.O. Box 307
Middlebury, VT 05753
Phone: 802 388-1328
Fax: 802 388-0210
info@vermontbiofuels.org

Once the oil is pressed, the fun has just begun...

Getting ready to do a titration to find out how much Lye we will need to complete out biodiesel reaction.

Aha! The pink indicates we have hit the right amount of lye.

So we measure out the amount of lye we just figured....

Mix it with some methanol...

Then add the oil...

And shake it!!

Next, we poured it into this contraption in order to let the glycerine and biodiesel separate. We would then be able to remove the glycerine and be left with biodiesel!!

It is usually a good idea to wash your biodiesel after processing. Piedmont Biofuels has a nifty piece of equipment in their travelling biodiesel processor that mists water into the biodiesel. That water then settles out, taking soaps and other impurities with it.

Stateline Farm Biodiesel Facility

John Williamson of Stateline Farm explains how they got started making their own fuel, how their facility works, and plans for the future.

Posted by Jericho Bicknell at 2:04 PM | Permalink | Comments (0) | TrackBacks (0)

Have you had an experience with crop insurance that you would be willing to share? This could be a good experience, bad experience, neutral experience...
I am just interested to hear first-hand how the RMA Crop Insurance programs are working or not working for Vermont farmers. Since I am supposed to be educating people about these programs, some knowledge of actual experiences would be very helpful. Has someone experienced a loss and been relieved to have had crop insurance? Is Catastrophic coverage worth $100 per year, or is the chance of losing 50% of your crop too slim? Is anyone using Adjusted Gross Revenue-Lite insurance for catastrophic animal health coverage instead of some sort of livestock insurance?

I would love to hear your stories. Feel free to post a comment on this blog or send an email to: agrisk@uvm.edu

Posted by Jericho Bicknell at 1:49 PM | Permalink | Comments (0) | TrackBacks (0)