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Source: USDA, 12/2/21
In response to feedback received from
the producers, the U.S. Department of Agriculture (USDA) is improving crop
insurance for hemp. USDA’s Risk Management Agency (RMA) is strengthening the
hemp crop insurance policy by adding flexibilities around how producers work
with processors as well as improving consistency with the most recent USDA hemp
regulation.“Hemp is an emerging crop, and we are working with hemp producers to provide insurance options that make sense for producers and for insurance providers,” RMA Administrator Marcia Bunger said. “RMA has worked to expand and refine our offerings to be responsive and dynamic.” RMA revised the policy to
add flexibility to the insurability requirements for hemp under contract.
Producers are no longer required to deliver hemp without economic value for
insurability. However, contracts between producers and processors may still
include delivery requirements. Additionally, RMA clarified how the amount of
insurable acreage is determined if the processor contract specifies both an
acreage and a production amount. This change was made in the policy to ensure
producers know how their insurable acreage is determined for those contracts. Other
Updates To ensure consistency
across USDA, RMA updated references to regulations, including the Agriculture Marketing Service final rule, which took effect March 22, 2021. Additionally, RMA added a
new requirement for producers who grow direct-seeded hemp, or hemp grown from
seeds planted in the ground. Before insurance attaches, producers must have
acreage inspected and must have a minimum of 1,200 live plants per acre. This
requirement was added to align direct-seeded hemp with the common farming
practice for transplanted Cannabidiol (CBD) of transplanting at least 1,200
live plants per acre. About
the Hemp Policy The hemp crop insurance
policy provides Actual Production History (APH) coverage against loss of yield
due to insurable causes of loss for hemp grown for fiber, grain, or CBD oil.
The Farm Bill defines hemp as containing 0.3% or less tetrahydrocannabinol
(THC) on a dry-weight basis. Hemp having THC above the federal statutory
compliance level of 0.3% is an uninsurable or ineligible cause of loss and will
result in the hemp production being ineligible for production history purposes. The hemp crop insurance
policy is available in certain counties within 25 states: Alabama, Arizona,
Arkansas, California, Colorado, Illinois, Indiana, Kansas, Kentucky, Maine,
Michigan, Minnesota, Montana, Nevada, New Mexico, New York, North Carolina,
North Dakota, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Virginia, and
Wisconsin. In 2021, hemp producers
insured 12,189 acres and 59 policies to protect $10.9 million in liabilities. Other
Coverage for Hemp In addition to the APH crop insurance policy, coverage for hemp is available through Whole-Farm Revenue Protection, the Nursery crop insurance program, and the Nursery Value Select pilot crop insurance program. Additionally, the Noninsured Crop Disaster Assistance Program coverage, offered through USDA’s Farm Service Agency (FSA), protects against losses associated with lower yields, destroyed crops or prevented planting where no permanent federal crop insurance program is available. The 2018 Farm Bill
reclassified and legalized the regulated production of industrial hemp as an
agricultural commodity (it is now legal to grow industrial hemp). Hemp
producers can learn more at farmers.gov/hemp. More
Information Crop insurance is sold
and delivered solely through private crop insurance agents. A list of crop
insurance agents is available at all USDA Service Centers and online at the RMA Agent Locator. Learn more about crop insurance and the modern farm
safety net at www.rma.usda.gov.
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