| RICE
Crop
Revenue Coverage
(CRC)
provides revenue protection against a decline in market
prices as well as a shortfall in production. Under CRC,
the guarantee is in dollars. A loss situation arises
when the dollar value of your production falls below the
final dollar guarantee. CRC provides protection whether
prices are rising or falling:
-
In a year of rising
prices, production shortfalls are compensated at the
higher market-based harvest price. This is important
if any lost production must be replaced at higher
market prices to fulfill delivery on a forward
contract;
-
In years of falling
prices, your minimum guarantee ensures that you will
receive a pre-determined amount of income per acre,
regardless of yields or prices.
Causes of Loss
CRC provides protection against unavoidable loss of
revenue due to the following causes in the insurance
period:
Adverse weather conditions1
Failure of irrigation
water supply2
Fire
Harvest price less than base price
Insects3
Plant disease3
Wildlife
1Natural perils such as
hail, frost, freeze, wind, drought, and excess moisture.
2If caused by an insured peril. 3But not damage due to
insufficient or improper application of recommended
control measures.
Important Dates
Note: Sales closing, final planting and acreage
reporting dates vary by county. Consult a crop insurance
professional for specific dates in your county.
Minimum Guarantee
The guaranteed minimum dollar
protection is the average yield X base price X coverage
level percent:
Example:
800 pounds per acre X $.60 X 75
percent = $360 per acre minimum guarantee
Harvest Guarantee
Average yield X harvest price
X coverage level percent:
Example:
800 pounds per acre produced X
$.50 X 75 percent = $300 per acre harvest guarantee
Calculated Revenue
Value of your actual
production determined by pounds produced X harvest
price:
Example:
200 pounds per acre produced X
$.50 = $100 per acre calculated revenue
Note: The actual price you
receive for selling your crop is not a factor in
CRC calculations.
Loss Example
This example assumes average yield of 800 pounds per
acre, base price of $.60, harvest price of $.50, 200
pounds per acre production-to-count, and 65-percent
coverage level.
800 Pounds per acre approved yield
x .65 Coverage level
520 Pounds per acre guarantee basis
x .60 Base price per pound
$312 Minimum guarantee per acre
If harvest price is $.50 per lb, then the harvest
guarantee would be $260
(520 pounds per acre X $.50 = $260 per acre)
$312 Final guarantee per acre (greater of minimum or
harvest guarantee)
– 100 Calculated revenue (200 pounds per acre
produced X $.50 harvest price)
212 Indemnity per acre
– 9 Approximate cost per acre
$203 Net indemnity per acre |