November 2, 2018
Keeping you informed
While harvest is just getting started and reports suggest higher than average corn yields with good test weights, DON (deoxynivalenol) is a significant concern for corn producers and the industry as a whole. Agricorp understands the difficulties this plant disease can cause and the urgency for information.
Agricorp.com will feature a series of articles where producers can get up-to-date, accurate information about how coverage works and how Agricorp staff will support them through the Production Insurance process.
Visit the agricorp.com homepage regularly and click the banner "Latest updates for DON". Agricorp will provide more updates as information becomes available.
Customers can be assured that DON is an insured peril covered by Production Insurance.
2018 corn crop update
There are currently 8,581 customers with about 1.6 million acres of corn covered under Production Insurance. As of November 1, 880 damage reports had been filed due to DON, with the majority of damaged acres in Middlesex, Elgin, Huron and Lambton.
Agricorp understands the concern DON is causing for producers and buyers alike, while they wait for the market to stabilize. Customers and buyers are reporting that DON levels in their corn are highly variable from region to region, from field to field, and within fields. The variability of DON levels and the delay in harvest due to wet weather is making it difficult for customers and buyers to know the volumes of corn at different levels of DON.
At this time, customers and buyers are reporting that DON levels of 5 ppm to 8 ppm are being purchased. Buyers are holding off on purchasing corn with higher DON levels until harvest progresses and these volumes are understood.
The current recommendation from industry experts is for producers to harvest and dry their crop, if field conditions allow, and to have a DON level test completed. When testing for DON, use samples from each field to ensure a clearer understanding of the crop situation. Having your fields tested and understanding the market will help you plan your harvest.
Making decisions that are right for your business
It’s important for producers to have all the key information they need to make decisions about their corn. Before they can make those decisions, it is important for them to understand how their Production Insurance coverage works.
Production Insurance is a yield-based program that gives producers a guaranteed level of production that is unique to their farm. Payments are made when an insured peril, like DON, causes their yield to fall below their guarantee.
Production Insurance covers crop damage such as DON that occurs in the field. Corn with DON can be stored if dried properly with minimal risk of further disease development. Producers who have corn impacted by DON, and who are planning to store it on farm, should call Agricorp, have a DON level test, and retain all documentation of DON levels for future reference.
If customers decide to store their corn while they attempt to market the crop, Agricorp will keep their coverage active until it is determined if there is a market and the final yield is known. Damage that occurs as a result of storage is not covered by Production Insurance.
Current reports suggest a potential for very high yields for 2018 corn. These reports show yields in excess of individual average farm yields and Production Insurance guarantees. Production Insurance is based on an entire yield. Producers need to know their guarantee in order to understand their claim position. In many cases, high yielding fields can offset fields with low yields due to DON. For example, Huron County has some of the highest reported damaged acres due to DON but has also reported potential yields as high as189 bushels per acre. It's important that producers work with an Agricorp adjuster to understand the full yield potential of their corn, the expected impacts of DON on their whole crop, and how that compares to their guarantee, before making decisions about the marketability of their crop.
Agricorp adjusters are contacting customers with damage reports within two days, to have these very important conversations.
Agricorp is also working with industry to understand any changes in the market, the condition of the crop, and the best way to keep customers informed of their options.
If customers notice damage to their crop, they should contact Agricorp immediately and an adjuster will follow up within 48 hours.
If producers have harvested corn that is unmarketable due to high DON levels and are unable to store the crop, they are asked to contact Agricorp. An adjuster will contact them immediately to discuss options so that they can make the best decision for their farm.
Producers should also contact Agricorp if crop conditions worsen, or if they find themselves dealing with new or different situations with their crop.
Questions producers should ask themselves
- What is my guaranteed production (see 2018 Production Insurance documents)
- What final yield do I expect this year?
- Will my final yield likely be above or below my guarantee?
- Have I tested all of my fields? Do I have a representative sample?
- Have I talked to my elevator about what DON levels they are currently accepting and if they expect that to change?
- What are the recommended best practices for DON?
- Is it more beneficial to harvest marketable corn first?
- Is it more beneficial to market my DON affected corn now or later?
- Do I have options to dry and store corn while waiting for a market? What are the options?
- Have I contacted Agricorp to open a damage report? Do I need to speak with an Agricorp adjuster?