Last year, crop revenue insurance passed the acid test for protecting against price declines. This year's question is how well it will compensate for quality losses. It's a first-time consideration for much of the Corn Belt and an issue so widespread that the Risk Management Agency is expected to announce a clarification on quality protocols in the next few days.

Former RMA Administrator Eldon Gould, a Maple Park, Ill., corn and soybean grower was harvesting 35 percent or higher moisture corn last week and estimated that he and his son were spending about $100 per acre to dry it, versus the $200 per acre they'd get charged at a commercial elevator. "It's become a pocketbook issue for farmers," he says. But it's really a difficult choice since "when you dry 35-percent moisture corn, it gets pretty beat up."

Crop insurance's treatment for quality losses is much improved over 5 or 10 years ago, he notes, but "no one is totally happy with the it" since there's no such thing as a one-for-one compensation, Gould says.

High yields in some parts of the country also make it almost impossible to collect for quality adjustments, crop insurers tell me, since growers need both low yields and quality adjustments to trigger the 15 to 25 percent deductibles in their policies. Someone with a CAT policy and a 50 percent deductible won't see payback without a near total loss.

But profits and losses are still a work in progress. If harvest had proceeded normally, University of Illinois economist Gary Schnitkey had expected corn growers to lose about $8 per acre on average, and $15 per acre on soybeans, the worst financial performance in a decade. Now that projection is in flux: Drying costs are more typically in the $30 per acre range, Schnitkey says. Using the state's farm business records, he estimates that a typical Illinois grower probably added $70 per acre to costs on a 190 bu. yield. However, he had projected net losses based on a $3.25 season average price for corn. The $1 corn rally in corn futures the last few weeks may actually offset some of that pain if it stays around long enough to lift the season-average price, he notes.

Your best defense: If you suspect widespread mold or other kernel problems, contact your crop insurance agent so an adjuster can assess it before you put the crop in storage, advises Roger Schlitter, a crop insurance agent in Mason City, Iowa. "They should harvest a sample and have it checked at an elevator to see if mold is an issue," he adds.

So what kind of experience are you having with crop insurance claims this year?

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