The NCC has joined 43 other agricultural organizations in co-signing a letter to Senate Agriculture Committee Chairwoman Stabenow (D-Mich.) and Ranking Member Cochran (R-Miss.) supporting crop insurance and opposing provisions that would limit its effectiveness.

The letter, on the NCC’s website at www.cotton.org/issues/2013/upload/13cropinsletmay1.pdf, stated that insurance products offered through federal crop insurance are essential to food security, allowing farmers and ranchers to secure operating capital from lenders each year and produce food for consumers around the world.

Agricultural producers keep the rural economy on track, purchasing needed inputs and equipment and supporting jobs throughout rural America.

Without the risk protection provided by federal crop insurance, agricultural lenders would be forced to increase underwriting standards, increase costs to offset risk and reduce credit availability in some areas of the country to some producers.

The letter noted that as with other lines of insurance, crop insurance requires a broad pool of participants to function properly. Arbitrarily assigning a means test for support will affect the pool of participants, both in the near-term and longer-term.

If adopted, an income means test can reasonably be expected to be more restrictive in the future. Means testing unfairly discriminates against full-time farms and those producing higher value crops, such as specialty crops.

The organizations said that making crop insurance protection unaffordable would cause producers to reduce their program participation, resulting in a higher risk pool of insured producers, higher loss ratios over time and increased premium rates for those who remain in the program.

Limiting crop insurance protection also would yield the unintended consequence of increased calls for ad hoc, off-budget disaster assistance, which were not heard during the devastating 2012 crop production year.

The Committee is expected to mark up its version of the farm bill this month with floor action this summer.

Crop insurance undoubtedly faces challenges, as opponents already have indicated their intention to propose damaging amendments to this program.

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