URBANA, Ill. — Farmers have until the end of this month to decide if they’d like to take USDA’s new Margin Protection Crop Insurance plan. Todd Gleason has more…

Known as M-P, the program most closely aligns with the current A-R-P, or Area Revenue Protection crop insurance plan. University of Illinois Agricultural Economist Gary Schnitkey says while there are difference the one of note is the price setting period. It locks in input prices (the margin) based on corresponding futures traded in Chicago for urea, DAP, diesel fuel, and interest rates.

Schnitkey: The other side of it you might be interested in is setting a projected price now versus in February. We know that our projected prices for Margin Protection insurance are $3.96 for corn and $9.66 for soybean. So, if you wanted to set those now you could use Margin Protection. You could also go up to 95% coverage level. So that would be an advantage.

Schnitkey doesn’t see any compelling reason for ARP users to switch to Margin Protection and while the plan could be coupled with RP, he thinks the number of takers there will be limited.

— Gary Schnitkey, Extension Agricultural Economist – University of Illinois
Todd Gleason, Farm Broadcaster

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