farm safety net

Farming is in my blood, and I’m proud of that. I grew up on my family’s sheep ranch in northern Utah and managed our raspberry farm before coming to USDA. For the past three years, as Administrator for the Department’s Risk Management Agency (RMA), I’ve sat across the table and listened to producers who, like myself back in Utah, couldn’t find an insurance product for their operation.

Natural disasters and unexpected events make agriculture a risky business, so having a strong safety net is essential for today’s farmers and ranchers. Nobody knows that better than RMA.

Agriculture is an inherently risky business. Some risks are everyday business risks; some risks are brought on by natural disasters. Producers need to regularly manage for financial, marketing, production, human resource and legal risks.

Helping farmers and ranchers overcome such unexpected events, not only benefits individual producers, but also rural communities that depend on agriculture. Over time, resilient rural producers help form robust rural economies, which build a strong economic foundation and provide improved access to credit for the next generation of beginning farmers and ranchers.

The 2014 Farm Bill, passed by Congress and signed last week by President Obama, strengthens the farm safety net and ensures vital nutrition assistance for hardworking children and families during tough times. It closes loopholes and achieves much-needed reform, saving billions of taxpayer dollars.

Those accomplishments are significant and should be commended, particularly at a time when bipartisan victories in Washington are so rare.

We have already started work on a plan to implement the new Farm Bill. However, many of its provisions are new and complex. As we have done every step of the way in helping to craft this legislation, we will work to keep Congress and our stakeholders informed as we identify and prioritize everything—new regulations, guidance and other activities—that will be required so that we can implement the legislation in an efficient, timely and responsible manner.

As consumer demand for fresh fruit and vegetables increases, so do the production risks for the nation’s farmers as they grow these crops.  To meet this challenge, the Risk Management Agency (RMA) pays close attention to the changing agriculture sector to ensure that crop insurance is made available where feasible.

A tremendous amount of work goes into offering a new insurance product, making sure that the product provides the coverage needed by growers at a reasonable premium without distorting the market or affecting a grower’s management decisions for the crop. New insurance products must have written policy, underwriting and loss procedures, as well as an actuarially-sound premium rate. The ability to innovate with new and expanded insurance offerings to reflect modern and changing farming practices is central to how the Federal Crop Insurance Program works.