This Drought Is Awful, But with the Right Tools, Farmers Will Bounce Back

In many parts of Oklahoma, it seems like wheat farmers just can’t catch a break.

Not a one.

A late spring freeze, combined with excessively dry or extreme drought conditions throughout the winter and into spring have left many of the state’s wheat fields badly stressed or a complete bust. In fact, I’d say this is the worst I’ve ever seen, and I started farming here in the mid 1950s.

With the wheat harvest set to begin in about a month, farmers are expected to harvest about 40 percent less wheat this year than they did in 2013. The low soil moisture as we head into the hottest and driest months of the year has left many farmers wondering what they are about to go through.

For the state’s farmers who purchased crop insurance – and nowadays that’s nearly all of them – that will be their only saving grace. I don’t know of a farmer anywhere in Oklahoma who doesn’t buy crop insurance. It’s just like buying diesel fuel today…you don’t farm without it.

With the passage of the new Farm Bill, largely gone are the days of the Federal government stepping in and helping farmers who have been hit by a calamity.

Such bills cost taxpayers tens of billions of dollars in the past, and were not only expensive but also slow to deliver the help to the farmers who needed it. Today, when a farm crisis hits, farmers turn to their crop insurance policy, not the Federal government, for help. The public-private partnership that is today’s crop insurance ensures that farmers get the financial help they need in weeks, not years.

As a crop insurance agent, I can tell you firsthand that crop insurance is no small expense for most of the state’s farmers, who spend north of $20,000 a year purchasing policies that they pray they will not need. Of course there are smaller farmers and larger farmers, whose premiums exceed $70,000, but the point is that it isn’t cheap.

Farmers buy crop insurance today just like they buy homeowners and car insurance. And when what looks like a promising year turns into a bust, the only thing standing between some farmers and bankruptcy is their crop insurance policies.

Last year, Oklahoma farmers spent more than $91 million out of their own pockets to purchase the peace of mind and protection of crop insurance.

Crop insurance allows individual farmers to purchase the coverage they need, tailored to their farms, their financial standing and their tolerance to risk.

For farmers who rely on loans to operate – and that’s a lot of farmers – crop insurance has become a bank’s best friend. In fact, the best collateral you can take to a bank when you are seeking a loan is your crop insurance policy. The bank will often co-sign the policy with the farmer, and in doing so, they are assured that part of their loan is covered, regardless of weather or price swings.

Crop insurance is not only smart farm policy, but smart consumer policy as well. American consumers have come to see our affordable, abundant food supply as a birthright. In fact, most of us alive today have never seen wide-scale hunger in this country. But much of what we take for granted could quickly disappear if we allow our farmers to fail and were forced to import our food, fiber and fuel. That is not a position many of us would choose to be in and it underscores the fact that having a strong farm sector is a national security issue.

While this might be the worst drought I’ve ever seen, I have to say that my faith in the resilience and work ethic of Oklahoma’s farmers is undying, and I know that with their crop insurance policies as a backstop, our farmers will bounce back from this. When Congress addresses crop insurance in the next Farm Bill five years down the road, I hope it is to protect the public-private partnership that has made it successful and to further improve and expand its protection.

Max Claybaker is a farmer and a crop insurance insurance agent from Blackwell, Oklahoma.  This op-ed appeared in The Oklahoman on June 1, 2014.