How Do Risk Management And Farm Policy Reconcile Their Differences?
As Cornbelt farmers head into 2007 with their risk management program in place (crop insurance, marketing plan, etc.), something may seem a bit unsettling. Crop insurance, at least the revenue kind, is based on expected production and the expected market, which is based on domestic and foreign demand. But the USDA-funded crop insurance program and prices have a common bond with the World Trade Organization. And the WTO is trying to dismantle the US farm subsidy program, which includes crop insurance, and a variety of other farm program benefits. Suddenly, it appears to be a house of cards which is about to collapse around the hundreds of thousands of dollars of inputs about to be buried out in the field. Is this a nightmare or is it reality? Wake up and … USDA’s recent Outlook Forum explored risk management and trade issues and Mississippi State University agricultural economist Keith Coble says it is clear that US cotton subsidies could not withstand challenges with the World Trade Or
