A farm management specialist says this is going to be a year of lower revenues and controlling costs will be key.
While crop insurance premiums for 2014 will be less than the past few years, the University of Illinois' Gary Schnitkey says farmers probably shouldn't lower their crop insurance coverage because they still need to cover input and land costs.
"If you're looking at crop insurance this year from last year the biggest change is that we're going to have lower projected prices and that's what's used to set our guarantees on these crop insurance products. So, last year we had a $5.65 projected price for corn. This year that's likely to be a dollar lower at $4.60 and our guarantees will go down as well."
Schnitkey says lower coverage levels will expose farmers to revenue risk.
"Most farmers have been upping their coverage levels. In fact, the most used coverage level in Illinois is at 85 percent, and I would suggest staying at those levels."
He says southern Illinois, Missouri and other areas have lower levels but farmers in higher coverage areas.
Schnitkey tells Brownfield Ag News that maintaining high coverage is especially important for farmers with high cash rent levels or high debt-to-asset positions. Calculations to determine spring guarantees for crop insurance begin in a few weeks.