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Empower Farmers to Solve Farm Issues During Tough Times

Posted on: March 17, 2020   |   Category: News Releases
Doug
Doug Sombke, SDFU President

Op Ed by Doug Sombke, SDFU President

I don’t know about you, but I don’t like taking problems to political leaders and agency officials unless I have a solution in mind. I guess it’s the farmer in me.

So, when I look at the current state of agriculture, and the many challenges facing family farmers and ranchers across South Dakota and the nation, I propose the farmer-developed, expert-tested Inventory Management Soil Enhancement Tool (IMSET).

Today, when crop insurance revenue prices are at an all-time low, it is the common-sense, voluntary answer to the many challenges facing agriculture producers:

  • Over-supply of commodities
  • Slump in crude oil prices dragging grain markets even lower
  • High input costs
  • On-going Trade War

Developed by Craig Blindert, a Salem, S.D., crop and livestock farmer who also works as an independent crop insurance agent, IMSET is a market-based, voluntary, crop insurance plan to protect against market lows by encouraging farmers to plant marginal acres to a crop that enhances soil health when commodity markets don’t meet production costs. These same acres would have flexibility to be hay or grazed after a certain time of year.

Basically, a farmer’s crop insurance guarantee would go up 2 percent for every 1 percent of land that farmer voluntarily enrolled in a soil enhancement management plan for that growing season.

Craig developed this four years ago – when the markets were much more favorable than they are today. He brought it to me and together we reached out to experts at North Dakota State University, NDSU Extension, Frayne Olson, Crop Economist/Marketing Specialist with NDSU Extension and the Director for the Burdick Center for Cooperatives, and Saleem Shaik, Professor of AgriBusiness and Ag Economics at NDSU and the Director of the Center for Agricultural Policy and Trade Studies.

Utilizing economic modeling technology, they replicated some real-world examples and said Craig’s IMSET idea is solvent enough for additional research. “This would be an annual option where farmers could choose to voluntarily idle some acres in exchange for higher price coverage under crop insurance.”

Based on their preliminary results, they said IMSET would provide a much more timely and sustainable solution. Because, it is different from the current farm program and policy system which relies upon the marketplace to motivate yield adjustments, these experts explained, “the market will work itself out, the problem is, it usually results in farmers having multiple years of losses before they make yield adjustments, and it becomes a very painful process in which we lose farms and farmers. Craig’s idea could potentially provide an incentive to shift acres out of production quicker and not allow for as much financial pain.”

From a policy standpoint, the experts said Craig’s plan would also be more sustainable. “When policy is tied to something related to crop insurance, like an add-on, we would not expect to see too many restrictions. This is important, especially when you move into a new political environment, if tax reform does come through and adjustments are made to current farm programs.”

With this preliminary study complete, we began introducing this solution to Congressional leaders as well as Risk Management Agency (RMA) officials, first in D.C. then at their Kansas City headquarters.

What has their response been? They are interested more today than when we first introduced it. When we first introduced IMSET, times were much better – grain and crude oil markets were solid, trade with China was healthy, and the Corn Belt wasn’t flooding.

Times are tough. But farmers are even tougher. We do need support. But the support we need is not another bailout. It needs to come in the form of a voluntary management program that allows farmers to make wise decisions based on the markets, their farm and its situation. If you would like to learn more, please reach out to me, [email protected]