October 13, 2017
Hurricane Harvey’s toll on the southeastern Texas cotton crop is still being tallied.
An expert with Texas A&M says up to 400,000 bales of cotton were still on the stalk. That could force farmers to go through the time-consuming process of trying to harvest what’s salvageable, but knowing their crop’s value will be significantly reduced due to quality losses in both the lint and seed.
In other words, a far cry from reaping the rewards of a crop that was predicted to set records and be a money maker for farmers who have faced years of poor yields and low, stagnant prices.
The storm completely destroyed the gin where Richard Niemann, a farmer near Corpus Christi, has his cotton processed. So, he is sending the cotton that survived to another gin.
But Niemann will be last in line there, meaning a delayed payment for his cotton, which might not be processed until December.
Crop insurance adjusters are on their way to take a look at his losses and the losses on farms all across southeastern Texas.
Like most farmers in the area, Niemann had paid for some insurance protection. But he’s not sure yet how much will be covered and, he’ll still have a hefty deductible to shoulder.
Crop insurance in southeastern Texas, and all across the U.S., is a critical risk management tool in farming today.
“You have to have it to get a loan to grow your crops,” Niemann explained.
He says lawmakers need to beat back attempts to weaken crop insurance and should look for ways to make it even more affordable and available.
“Crop insurance and true price protection programs are the only things that are going to keep us in business some years,” he says. “It’s so volatile down here, especially in our area because it’s all weather related. The majority of our fields are not irrigated. We depend on annual rainfall to make a crop. In our area some years it happens, some years it doesn’t.”
But instead of maintaining and expanding crop insurance, some critics of farm policy, such as the Heritage Foundation, the Environmental Working Group, and the American Enterprise Institute are urging lawmakers to move in a different direction.
Amazingly, legislation to weaken the country’s crop insurance system was introduced a week after Harvey hit and just before Hurricane Irma battered the Florida coastline.
Such proposals could leave farmers with fewer insurance options and a weakened system for delivering aid after disasters.
Niemann would like to see more access to crop insurance in the next farm bill, not less, in addition to bringing cotton back in to Title I safety net programs like other crops.
“We darn sure don’t need less coverage. And we darn sure don’t need higher premiums,” he noted. “We need just the opposite. We need more coverage and preferably more affordable coverage.”
And then there’s the question of whether or not his cotton at the gin yard will be totally covered by a private insurance policy outside of federal crop insurance program.
Crop insurance usually doesn’t cover a crop once it’s been harvested.
Cotton gins and farmers in the region banded together years ago and bought a hurricane policy on 24 gins in the area. Of those, 14 were impacted by Harvey.
The policy covers damage from named hurricanes but Niemann and others are worried it won’t be large enough to cover all the damage from Harvey.
They couldn’t find a company in the United States interested in covering the facilities so they went all the way to Lloyd’s of London. It was very expensive and the farmers pay for it out of their own cotton every year but they felt it was necessary.
This year will be the first time they’ve tried to use the policy and Niemann is hoping it will cover his losses.
“I don’t know,” he says when contemplating the coming months. “If that hurricane policy on our harvested cotton doesn’t come through and cover the value of our loss, then I will lose a lot of money. I’m in the hole on my grain crop so I was really depending on big cotton yields to put me in the black for the year.”
Niemann warns that farmers losing money can be problematic for the country.
“The people who are fighting against the farm policies that help out growers, I don’t think they realize that once all the famers go out then we’re dependent on other countries for food and fiber,” he says. “Agriculture is what made our country. We built this country being able to produce and fend for ourselves. Once that’s gone, you can’t just jump back into it.”