Soybean Rust Threatens Nine States, Farmers Rethinking Coverage Choices
A warning to prepare for the worst and hope for the best has been issued by researchers who discovered late last year that when Hurricane Ivan tore across the southeastern U.S. it brought with it wind-borne soybean rust spores. Soybean rust promises to bring headaches to insurance companies with policyholders in at least nine states: Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, Missouri, South Carolina and Tennessee; and threatens to spread to bordering states like Texas and Oklahoma.
Experts are advising soybean producers to take care of their own risk as best they can, but if they felt in the past that they were unlikely to have an insurable loss, they may need to rethink that position.
There are two kinds of crop insurance: crop
In recent years there have been sweeping changes in the federal multiple peril crop program. Up until 1995, only about one-third of farmers bought federal multiple peril crop coverage since, in the event of a disaster, they could generally rely on Congress to bail them out with disaster assistance and emergency loans.
Recognizing the disease
Soybean rust is a fungal disease that attacks the foliage of a soybean plant causing the leaves to drop early, which inhibits pod setting and reduces yield. The amount of damage depends on how early infection occurs in the growth of the soybean plant. In its early stages it can resemble other plant diseases. Initial infection usually is first evident in the plant’s lower canopy. Soybean rust can survive on as many as 100 different hosts.
Soybean producers must decide by March 15 if they want to insure their crops against loss in 2005 from soybean rust or other causes,” Ray Massey, University of Missouri agricultural economist, said. “The U.S. Department of Agriculture Risk Management Agency states that ‘losses due to soybean production due to soybean rust disease is an insurable cause of loss.’
“With regard to rust, crop insurance actually becomes a better buy than it has been in the past,” Massey said.
Even if a farmer has insurance, according to Massey it is necessary to verify that rust outbreak was natural and that appropriate control measures were taken.
“The major impact of soybean rust may be that it causes farmers to rethink their crop insurance choices rather than just take the same level of coverage they’ve had for the last several years,” Massey explained.
In 2003, 75 percent of Missouri’s soybean acreage was insured and for the past five years, Missouri farmers have received more than $2 for every $1 paid in premiums. Data for 2004 is not yet available.
“Soybean rust survives in living plant material, so it can only live through the winter in the southern tip of Texas or Florida, places which have already had hard freezes this winter,” Dr. Laura Sweets, a plant pathologist with University of Missouri Extension, said. She advised producers to scout their fields and to watch the weather as southern winds might blow the disease spores north.
In November, soybean rust was discovered in northeast Arkansas near the Mississippi River, as well as in three Louisiana parishes–Iberia, St. John and St. Mary.
The Arkansas Soybean Promotion Board, a state agency, said in an announcement that response plans for Arkansas and other states include approving new fungicides to control the disease, winter training of field scouts for 2005, a crop monitoring program and detection network, and distributing information about the disease.
“The sample locations indicate a path that matches the wind patterns of Hurricane Ivan,” stated Dr. Clayton Hollier, a Louisiana State University AgCenter plant pathologist and its principal investigator for the Southern Pest Detection Network.
“If it had to happen, it couldn’t have happened at a better time of year,” said Craig Roussel, director of horticulture and quarantine programs with state agriculture and forestry department and one of two coordinators of the search effort. “More than 95 percent of the soybeans have already been harvested, so yields were not affected.”
Traveling north
“Soybean rust is right on our doorstep,” said Kentucky Agriculture Commissioner Richie Farmer. “We are fortunate that it appeared when the state’s soybean crop was already in the bins.”
While not yet in Kentucky, soybean rust has been reported in Missouri and Tennessee, Bill Clary, a spokesman for the Kentucky Department of Agriculture told Insurance Journal.
University of Kentucky plant pathologist Don Hershman said crop insurance providers in his state are aware of the disease.
Soybean rust statistics given by Hershman to local farmers are sobering. “For most diseases, the loss in yield is somewhere around 30 percent,” he said. “With rust, yield loss can be as high as 70 to 80 percent.”
The economic impact adds up. Some of the proposed preventative maintenance can cost farmers as much as $15 to $28 per treatment per acre. The measures would include spraying fungicide as many as three times. Additionally, the excessive spraying may curtail crop yields by as much as 10 percent.
“Finding Asian soybean rust in this country means farmers will have to make changes in their soybean management practices,” Dr. Ken Whitam, LSU AgCenter plant pathologist, said. “They will have to be diligent in early scouting of the disease and use more fungicides, which will increase their production costs.”
Experts advise farmers concerned about the impact of soybean rust on their crop insurance indemnities to talk to their crop insurance agent about good farming practices.
Under the terms of the Common Crop Insurance Policy, a practice is considered a good farming practice if agricultural experts agree that the production method used will allow the crop to make normal progress toward maturity and produce at least the yield used to determine the production guarantee.
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