North Dakota Congressman Kevin Cramer and North Dakota Agriculture Commissioner Doug Goehring have concerns about how rainfall is calculated in the Pasture, Rangeland, Forage Pilot Insurance Program.

“The more I learn about this program, the more I believe that it’s not the right fit for North Dakota producers without some modifications,” said Rep. Cramer in a statement released by his office after a meeting in Dickinson, N.D., with the USDA Risk Management Agency and ranchers.

“Like others, the PRF insurance program uses a national model to try and predict a very local issue,” Cramer said. “While this product might work well east of the Mississippi, I’m not convinced it’s doing a good job in North Dakota. The West has different topography, larger farms, and more remote spaces. I don’t think PRF insurance takes those and other unique qualities into account.”

Rep. Cramer hosted the meeting in Dickinson after hearing from ranchers that they were concerned about the way the precipitation was being calculated in western North Dakota for PRF insurance. There are fewer rain sensors in the western part of the state than in the east, and the rain estimates produced under PRF insurance are, in some cases, drastically different from the estimates in the USDA Drought Monitor, the ranchers claimed.

Goehring said inaccurate data reporting has been a problem for a number of years.

“I’m working with the National Weather Service to close some of these loopholes,” he said in a statement released by his office. “You lose confidence in the system when it tells you that this grid is reporting at 139% or that grid is at 237%, and you’re thinking, ‘We didn’t even get that back then.’”

Cramer said the meeting “brought light” to the PRF insurance.

“I think it will help ranchers make better choices for their future. At the same time, we as legislators need to take a deeper look into the way the model evaluates precipitation across the region. The more transparent and understood the PRF program, and others, can be for our producers, the better off we’ll all be in making decisions during times of drought and other disasters,” Cramer said.

RMA officials said the PRF insurance program wasn’t created as a drought insurance program, but rather a risk management tool meant to hedge losses over a long period of time for producers.

For RPF insurance coverage, producers must choose at least two, two-month periods when precipitation is important to their operation. These periods are called index intervals. Losses are calculated based on whether the current year’s precipitation in a grid has deviated from normal compared to the historical normal precipitation in the same grid, for the same period. RMA uses the National Oceanic and Atmospheric Administration’s Climate Prediction Center data to calculate normal precipitation and deviations from normal precipitation. Losses are not based on a single ranch or a specific weather station in a general area.

According to RMA’s website, RMA uses NOAA precipitation data based on the optimal interpolation methodology. Interpolation is based on the idea that things closer together in space are generally more similar than those farther apart, and it estimates precipitation for a grid using reporting stations within a search radius around the grid.

More information about the technology and how NOAA CPC interpolates weather data to a specific grid can be found on RMA’s PRF web page. Select “Rainfall Index, Pasture, Rangeland, Forage Technology.” You can also see answers to common questions about the PRF insurance on the web page.