Coronavirus Jitters Cause Lower Crop Insurance Guarantees

The market’s coronavirus-induced drop in value last week also resulted in a lower guarantee rates for corn and soybean crop insurance. DTN reports that guarantees for crop insurance this year are $3.88 a bushel for corn and $9.17 for soybeans. Those are down 12 and 37 cents respectively from last year. Officials came up with the guarantee by averaging the daily close of the new December corn and November soybean contracts through the month of February. Jim Mintert, director of the Center for Commercial Agriculture at Purdue University, said the lower benchmark means a lower revenue guarantee and less coverage than what might have been available had the market correction occurred in early March. Depending on the volatility of some factors included in the price guarantee calculations, lower guarantees could lead to lower premiums.