Request for Information on Prevented Planting

Citation88 FR 62524
Published date12 September 2023
Record Number2023-19584
CourtFederal Crop Insurance Corporation,Risk Management Agency
Federal Register, Volume 88 Issue 175 (Tuesday, September 12, 2023)
[Federal Register Volume 88, Number 175 (Tuesday, September 12, 2023)]
                [Pages 62524-62526]
                From the Federal Register Online via the Government Publishing Office []
                [FR Doc No: 2023-19584]
                 Federal Register
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                Federal Register / Vol. 88, No. 175 / Tuesday, September 12, 2023 /
                [[Page 62524]]
                Federal Crop Insurance Corporation
                Risk Management Agency
                [Docket ID FCIC-23-0001]
                Request for Information on Prevented Planting
                AGENCY: Federal Crop Insurance Corporation and Risk Management Agency,
                Department of Agriculture (USDA).
                ACTION: Notice of request for information; reopening of comment period.
                SUMMARY: The Federal Crop Insurance Corporation (FCIC) is reopening the
                comment period for 30 days to allow the public additional time to
                provide comments on the prevented planting provisions of the Common
                Crop Insurance Policy (CCIP), Basic Provisions published on May 23,
                2023. Prevented planting is a feature of many crop insurance plans that
                provides a payment to cover certain pre-plant costs for a crop that was
                prevented from being planted due to an insurable cause of loss. FCIC is
                interested in public input on the following: additional prevented
                planting coverage based on harvest prices in situations when harvest
                prices are higher than established prices initially set by FCIC prior
                to planting; the requirement that acreage must have been planted to a
                crop, insured, and harvested, in at least 1 of the 4 most recent crop
                years; additional levels of prevented planting coverage; prevented
                planting coverage on contracted crops; and other general prevented
                planting questions.
                DATES: The comment period for the Request for Information on Prevented
                Planting published on May 23, 2023, (at 88 FR 33081) is reopened. We
                will consider comments that we receive by October 12, 2023.
                ADDRESSES: We invite you to submit comments in response to this notice.
                Send your comments through the method below:
                 Federal eRulemaking Portal: Go to and search for Docket ID FCIC-23-0001. Follow the
                instructions for submitting comments.
                 All comments will be posted without change and will be publicly
                available on
                FOR FURTHER INFORMATION CONTACT: Francie Tolle; telephone (816) 926-
                7829; or email [email protected]. Persons with disabilities who
                require alternative means for communication should contact the USDA
                Target Center at (202) 720-2600 (voice).
                 FCIC is reopening the comment period for the Request for
                Information on Prevented Planting that was published on May 23, 2023,
                (at 88 FR 33081-33084). The comment period for the original notice
                closed on September 1, 2023. Based on requests received during the
                initial comment period, FCIC is reopening the comment period for an
                additional 30 days to allow the public to comment on the prevented
                planting provisions.
                 FCIC serves America's agricultural producers through effective,
                market-based risk management tools to strengthen the economic stability
                of agricultural producers and rural communities. FCIC is committed to
                increasing the availability and effectiveness of Federal crop insurance
                as a risk management tool. The Risk Management Agency (RMA) administers
                the FCIC regulations. The Approved Insurance Providers (AIP) sell and
                service Federal crop insurance policies in every state through a
                public-private partnership. FCIC reinsures the AIPs who share the risk
                associated with losses due to natural causes. FCIC's vision is to
                secure the future of agriculture by providing world class risk
                management tools to rural America.
                 Prevented planting coverage pays when a producer is unable to plant
                an insured crop due to an insured cause of loss. The payment is
                intended to assist in covering the normal costs associated with
                preparing the land up to the point of the seed going in the ground
                (pre-plant costs). These pre-plant costs can include seed, purchase of
                machinery, land rent, fertilizer, actions taken to ready the field,
                pesticide, labor, and repairs. Coverage is calculated as a percent of
                the producer's insurance guarantee (for example, 60 percent for
                 FCIC is interested in all general prevented planting comments but
                requests public input from stakeholders on the following specific
                Prevented Planting Coverage Based on Harvest Prices for Revenue
                Protection Insurance
                 Revenue protection is a plan of insurance that provides protection
                against loss of revenue due to a production loss, price decline or
                increase, or a combination of both. Under the revenue protection plan
                of insurance, yield losses are compensated using the harvest-time price
                if it is higher than the price FCIC projected prior to planting. This
                compensates producers for the replacement value of lost bushels. This
                type of coverage was intended to help producers mitigate the risk of
                having to buy out of delivery contracts they are unable to fulfill due
                to production losses. Currently, the prevented planting calculation for
                revenue protection is based on the projected price and does not
                increase with the harvest price.
                 Revenue protection is the most popular insurance coverage in the
                crop insurance program. Under revenue protection, producers may elect a
                harvest price exclusion option which removes the protection against
                loss of revenue due to harvest price increase. Over 99 percent of
                revenue protection policies maintain harvest price coverage.
                 Following the volume of prevented planting payments for 2019 and
                2020, a consistent suggestion emerged to allow prevented planting
                payments to increase with the harvest price, as is currently done for
                lost production. Allowing the harvest price for prevented planting
                payments would not impact most years as there needs to be both an
                increase in the harvest price and a prevented planting claim.
                Historical data suggests the additional coverage would increase
                prevented planting payments by approximately 6 percent on average for
                those policies with harvest price revenue coverage. Consequently, there
                would need to be a corresponding increase in premium for these
                [[Page 62525]]
                 The following are questions for input regarding prevented planting
                coverage based on the harvest pprice:
                1. Should prevented planting payments be based on the harvest price
                or the price used to establish the insurance guarantee (projected
                 2. What specific advantages or disadvantages do you see for
                allowing prevented planting coverage to be based on the harvest price?
                 3. When a producer is prevented from planting, what additional loss
                does a producer suffer when the harvest price increases and what should
                be considered to estimate the value of the loss?
                 4. Do you have any concerns about allowing prevented planting
                coverage to be based on the harvest price?
                Prevented Planting ``1 in 4'' Requirement
                 Beginning with the 2021 crop year, FCIC revised the prevented
                planting provisions to implement the ``1 in 4'' requirement nationwide.
                The ``1 in 4'' requirement states that acreage must have been planted
                to a crop, insured, and harvested (or if not harvested, adjusted for
                claim purposes due to an insurable cause of loss) in at least 1 out of
                the previous 4 crop years. This was meant to reduce prevented planting
                payments on land that is not generally available to plant, thus
                lowering insurance costs for all producers. Prior to the 2021 crop
                year, the ``1 in 4'' requirement was only applicable to the Prairie
                Pothole National Priority Area and required that the acreage must be
                physically available for planting.
                 In late 2022, FCIC announced the ``1 in 4'' requirement would be
                removed from western states that have experienced significant ongoing
                drought in recent years. The purpose of removing the requirement in
                these states was to give FCIC more time to better understand the unique
                needs of western producers and to also ensure all parties can provide
                input on the change.
                 The following are questions regarding the prevented planting ``1 in
                4'' requirement:
                 1. Since the nationwide implementation of the ``1 in 4''
                requirement, what situations have created challenges due to this
                requirement for producers that have been prevented from planting?
                 2. Do you have recommendations that would make the requirement more
                flexible for producers while protecting the integrity of the Federal
                Crop Insurance Program?
                 3. Are there specific situations that should exempt land from the
                ``1 in 4'' requirement and why?
                 4. Should the requirement be removed from specific areas and why?
                 5. A portion of the ``1 in 4'' requirement allows crops that have
                been adjusted for claims purposes due to an insured cause of loss to be
                considered harvested. However, this allowance excludes claims adjusted
                due to the following causes of loss: flood, excess moisture, and
                drought. Should the requirement exclude specific causes of loss
                adjusted for claims purposes and why?
                 6. Are you aware of additional program integrity measures or
                safeguards that should be considered beyond what is in place today?
                 7. Do you believe there should be a limit on the number of
                consecutive years that a producer is eligible to receive a prevented
                planting payment on the same acreage? If so, what do you believe the
                limit should be?
                Prevented Planting 10 Percent Additional Coverage
                 Insureds with additional coverage, a coverage level greater than
                catastrophic risk protection, may elect an additional level of
                prevented planting coverage, commonly referred to as buy-up coverage,
                on or before the sales closing date. The additional coverage level
                allows producers to better tailor their coverage to match their actual
                prevented planting costs. The additional level of prevented planting
                coverage also requires the producer pay additional premium. Prior to
                the 2018 crop year, two additional prevented planting coverage levels
                were available, 5 percent (+5) and 10 percent (+10). FCIC removed the
                +10 additional coverage option beginning in the 2018 crop year.
                Removing the +10 additional coverage option maintained the balance
                between providing coverage to producers and the cost to taxpayers.
                While FCIC has removed the +10 additional coverage option, the +5
                additional coverage option is still available.
                 RMA is considering reinstating the +10 additional coverage option.
                The following are questions regarding the +10 additional coverage
                 1. What specific advantages or disadvantages do you see regarding
                reinstating the +10 additional coverage option?
                 2. If you believe reinstating the +10 additional coverage option
                will provide needed protection for producers, why is it needed in
                addition to the current +5 additional coverage option?
                 3. Do you have any concerns about reinstating the +10 additional
                coverage option?
                Prevented Planting Coverage on Contracted Crops
                 For several crops, crop types, or specific practices grown under a
                contract with a processor, a contract price option allows a producer to
                use their contract price to determine the insurance guarantee. For
                example, the Contract Price Addendum allows organic certified and
                transitional producers of many crops to use the price contained in
                their organic contract for insurance. Currently, when the contract
                price option is elected, the prevented planting coverage is based on
                the contract price. However, it has been suggested that prevented
                planting costs may be the same regardless of whether the producer had a
                contract. FCIC is requesting input on whether the prevented planting
                guarantee should use the RMA established price (price election or
                projected price), regardless of if the contract price option has been
                 The price election is the amount contained in the actuarial
                documents that is the value per pound, bushel, ton, carton, or other
                applicable unit of measure for the purposes of determining premium and
                indemnity under the policy. The projected price is the price for each
                crop determined in accordance with the Commodity Exchange Price
                Provisions.\1\ The applicable projected price is used for each crop for
                which revenue protection is available, regardless of whether you elect
                to obtain revenue protection or yield protection for the crop.
                 \1\ The Commodity Exchange Price Provisions (CEPP) are used in
                conjunction with either the Common Crop Insurance Policy Basic
                Provisions or the Area Risk Protection Insurance Basic Provisions,
                along with Crop Provisions for the following crops: barley, canola
                or rapeseed, corn, cotton, grain sorghum, rice, soybeans,
                sunflowers, and wheat. CEPP specifies how and when the projected and
                harvest price components will be determined. Updated CEPP documents
                are on the RMA website at
                 The following are questions regarding prevented planting coverage
                on contracted crops that can elect the contract price option:
                 1. Are pre-planting costs higher for contracted crops? If so,
                 2. Should prevented planting payments be based on the contract
                price or RMA's established price (price election or projected price)?
                Please explain why.
                 3. If a contract price is used for prevented planting guarantee
                purposes, should there be any limitations as to when the contract is
                secured, specifically when a cause of loss is present that may prevent
                [[Page 62526]]
                Other General Prevented Planting Questions
                 1. Do you believe all producers will support paying higher premiums
                to cover the costs of expanded prevented planting benefits?
                 2. Are pre-planting costs the same for all causes of loss? For
                example: Does a multi-year drought leading to failure of irrigation
                supply have the same pre-planting costs as unexpected flooding prior to
                Marcia Bunger,
                Manager, Federal Crop Insurance Corporation; and Administrator, Risk
                Management Agency.
                [FR Doc. 2023-19584 Filed 9-11-23; 8:45 am]
                BILLING CODE 3410-08-P

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