WASHINGTON-Crop insurance is a complex topic, but it may come in handy for area farmers as they ride out the fifth driest year since data recording began in 1894. Rainfall is down 2.94 inches from an average year, according to the National Integrated Drought Information System (NIDIS), resulting in lower yields for many dryland producers.

According to data from the NIDIS, which can be accessed at http://www.drought.gov, April 2021 has been the second driest month since the system began recording data in Walla Walla 127 years ago. One hundred percent of Walla Walla has experienced a D0-dryness level, or "Abnormally dry" spring season, with 97.85% of the county experiencing a D1-level, or "Moderate Drought." D1-level conditions increase fire danger and are evidenced by slower river flow and a heightened possibility of dust storms.

A slightly lower percentage of the county, 94.4%, is currently experiencing a D2-level drought, or "severe drought," evidenced by stunted wheat and corn, resulting in an earlier harvest. D2-level drought also affects cattle and dairy farmers, as silage becomes harder to find. Wildfire danger significantly increases in a D2-level drought as wild grasses and ground cover dry out earlier than normal. There are nearly 193,000 acres of wheat in Walla Walla County.

Columbia County has fared slightly better than Walla Walla County so far, with only 62.7% of the county experiencing severe drought conditions. 86.2% of Columbia County is fighting D1 drought conditions. Like Walla Walla, Columbia County is experiencing its second-driest April in 127 years of data collection and the 19th driest year-to-date. Nearly 75,000 acres of wheat are located in Columbia County.

"With it being drier and warmer than we've had in the past, I'd say it's going to be an early harvest and a quicker harvest," said Curtis Evanenko, the Risk Management Advisor with McGregor Risk Management Services. "There are going to be fewer bushels to harvest."

The Department of Ecology issued a drought advisory in late May, which remains in effect as drought conditions persist in both counties.

Wheat and other crop producers rely on private and government insurance options and providers to protect against various conditions, including drought. The Federal Crop Insurance Program (FCIP) was created in 1938, with the passage of the Federal Crop Insurance Act. The FCIA is a unique public-private partnership offering protection to the insurers and subsidizing farmer-paid premiums. Originally, participation was low due to high costs, and the program was overhauled in the 1990s by Congress, including an increase in federal subsidy levels. According to the USDA Risk Management Agency, legislation passed in the 2000s broadened the range of insurance products available to U.S farmers.

The United States Department of Agriculture (USDA) data showed that roughly 83% of all US crop acreage is insured under the FCIP. In 2017, more than 311 million acres were covered by the program, according to data from the USDA.

There are 15 insurers that participate in the FCIP, offering Multiple Peril Crop Insurance (MPCI); a complete list of insurers can be found at http://www.cropinsuranceamerica.org.

Similar to car or home insurance, independent agents collect premiums, issue policies, and pay claims. The federal government acts as a reinsurer, providing financial protection to the insurance companies. If the total amount an insurer pays out in claims exceeds the premiums collected, the government shares in the losses. On the flip side, if the insurance provider collects more premiums than it pays out, the government shares in the gains, according to a report released in February 2021 by the Congressional Research Service. Always check with your local insurance agent for their crop insurance option. Avren Childers, the State Farm Agent in Dayton, is a local expert and can help navigate options.

Limited crops, including corn, cotton, soybeans, and wheat, are the most frequently insured crops under the program. Less-commonly produced crops, including blueberries, citrus and pumpkins, may be insurable in their respective, key-growing areas. According to the Insurance Information Institute, more than 90% of farmers who purchase crop insurance opt for Multiple Peril coverage.

There are two kinds of crop insurance available through the program, with MPCI policies being the most commonly purchased. Multiple Peril Crop policies cover the loss of crops due to drought, freezes, disease, and other natural causes.

These policies can be yield-based or revenue-based. Yield-based policies provide a payout if the policyholder suffers a yield loss relative to their historical yield. According to North Dakota State University, wheat yields are determined by using the number of spikes (heads of wheat), kernels per spike, and kernel weight. The university has created a formula to find bushels per acre: (spikes per 3 ft. of row X spikelets per spike X kernels per spikelet X 0.142). All assessments require the involvement of a crop insurance professional.

With a yield-based policy, farmers receive payout when losses exceed 50% of their normal yield and receive a payout for 55% of the estimated market value of the crop. Higher levels of coverage are available, but a higher farmer-paid premium is required. According to the Congressional Budget Office, the federal government pays an average of 60% of total premiums, leaving farmers 40%.

Farmers with single crops commonly choose revenue-based policies. Under these policies, farmers can select coverage for up to 85% of the average yield.

In the case that a crop fails, the farmer will still need to complete the harvest. Former State Farm agent Bette Lou Crother of Dayton, explained that harvest is necessary in order to accurately determine yield and how much the insurance claim must cover. Unless the farmer expects to claim a total loss, which is decided upon by insurance adjusters, harvest must be completed. Completing the harvest also helps the local economy by providing the temporary jobs many local residents rely on.

The region is creeping towards more severe drought conditions with no rain in sight, but it is unclear exactly how severe the impact will be on the wheat harvest. The level of impact to the farmers in our region will ultimately be defined by the severity of this year's drought conditions and the insurance coverage each has in place.