Crop insurance is a non-agronomic tool you can use in managing risk of loss due to rust. However, certain rules must be followed.
You should check with your insurance agent to understand and comply with the terms of your insurance policy to ensure you will be adequately prepared to meet the challenges if presented with the disease.
Asian soybean rust is an insured peril under the federal crop insurance program. However, damage due to insufficient or improper application of available disease control measures is not covered. That's where the risk comes in.
You must use good farming practices as defined by the crop insurance policy. A practice is considered good if agricultural experts agree that the production method used will allow the crop to make normal progress toward maturity and produce an average yield, including any adjustments for late planting.
Additional definitions say the practice must not reduce or adversely affect the yield if it is applied, or not applied, to the crop.
Lastly, the practice must be recognized as applicable for the area.
Failure to purchase or apply adequate control measures due to cost is not an insurable cause of loss. Appropriate treatment may vary from timing of application, frequency and choice of chemical or other determining factors.
You should regularly scout your fields and document your findings. If your soybeans become infected you should document the date of discovery of the disease, any recommendations received from agricultural experts and your actions taken toward controlling it.
Agricultural experts defined by the Risk Management Agency (RMA) include plant pathologists employed by the Cooperative State Research, Education and Extension Service, state agricultural departments, universities and certified crop consultants.
It's your insurance agent's responsibility to verify that losses are unavoidable due to naturally occurring events. That includes verifying you followed good farming practices, that chemicals and equipment were or were not available, or if excessive moisture prevented you from getting to the crop.
If you have federal crop insurance and you choose to not properly care for the crop, it is still insured. However, the losses associated with the decision to not care for the crop would be considered damage caused by uninsured causes. The production loss associated with such uninsured causes would be considered in the determination of production resulting in a reduction of the indemnity.
For example, if an application of disease control measures would prevent further losses of 5 bu./acre and you elect to not treat the crop, then crop insurance may cover other losses above and beyond that 5 bu./acre.
If Renting, Who Pays For Fungicides?
Chemical costs are shared in many shared-rent arrangements, which includes fungicides used to prevent or treat rust. Generally, these costs are shared in proportion to the shares of crop revenue — for example, 50-50 share arrangements. The application may be the tenant's responsibility.
Questions sometimes arise on how to share fungicide costs where costs are not shared in proportion to crop revenues. For example, you may have a two-thirds/one-third crop-share arrangement where the tenant may pay all herbicide costs and pesticide costs, which likely include fungicides.
First, check your lease. It may address this issue. If it doesn't, you should address it before it becomes an issue and work out an agreement with your landlord. It may involve sharing the fungicide costs in proportion to the revenue sharing, but each situation may be different.
If you have other lease arrangements, such as a bushel lease, then you as a tenant have to pay for the fungicide and application.
Since rust is new, it may be wise to address the issue before 2006 lease negotiations so everyone knows their respective roles and responsibilities.
Rust may be something you need to live with for some time, so learning and documenting your actions is the best way to manage risk.
Moe Russell is president of Russell Consulting Group, Panora, IA. Russell provides risk management advice to clients in 20 states. For more risk management tips, check his Web site (www.russellconsultinggroup.net) or call toll-free 877-333-6135.