Crop Insurance for Hemp
Have you heard about crop insurance? Do you have crop insurance for your hemp? If not, here’s the most recent update. Crop insurance is sold through private crop insurance agents. A list of crop insurance agents is available at all USDA Service Centers and online at the RMA Agent Locator. If you are interested in learning more about crop insurance click here.
In response to the feedback given by the producers, the U.S. Department of Agriculture (USDA) is currently improving crop insurance for hemp. The USDA’s Risk Management Agency (RMA) is working on “strengthening the hemp crop insurance policy by adding flexibilities around how producers work with processors as well as improving consistency with the most recent USDA hemp regulation. Hemp is an emerging crop, and we are working with hemp producers to provide insurance options that make sense for producers and for insurance providers,” RMA Administrator Marcia Bunger said. “RMA has worked to expand and refine our offerings to be responsive and dynamic”” (USDA).
The USDA’s RMA recently revised the policy to add flexibility to the insurability requirements for hemp under contract. Now, the producers will no longer be required to deliver hemp without economic value for insurability. However, the contracts between the producers and the processors may potentially include delivery requirements. Furthermore, the RMA has clarified that the amount of insurable acreage is determined if the processor’s contract specifies both an acreage and a production amount. This change took place to ensure the producers know how their insurable acreage is determined for those contracts. On top of that, the RMA has also added a new requirement for producers who grow direct-seeded hemp. Prior to the insurance attachment, the producers must have their acreage inspected and are required to have a minimum of 1,200 live plants per acre. This requirement was added to align with the common farming practice for transplanted Cannabidiol (CBD) of transplanting at least 1,200 live plants per acre.
“The hemp crop insurance policy provides Actual Production History (APH) coverage against loss of yield due to insurable causes of loss for hemp grown for fiber, grain, or CBD oil” (USDA). The Farm Bill defines hemp as containing 0.3% or less THC on a dry-weight basis. Any hemp having THC above the federal statutory compliance level of 0.3% is uninsurable. The hemp crop insurance policy is available in certain counties within these 25 states; Alabama, Arizona, Arkansas, California, Colorado, Illinois, Indiana, Kansas, Kentucky, Maine, Michigan, Minnesota, Montana, Nevada, New Mexico, New York, North Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Virginia, and Wisconsin.
Wow! In 2021, hemp producers insured 12,189 acres and 59 policies to protect $10.9 million in liabilities (USDA).