WASHINGTON (Reuters) – Corn farmers are getting the lion's share of U.S. crop insurance payments on losses caused mainly to drought last year – 63 percent of the record $12.3 billion paid so far, the Agriculture Department said on Monday.
Some experts say indemnities could top $20 billion, nearly double the old record set in 2011. Record-high payments would drive up the program's cost to the federal government, which subsidizes the insurance policies and shares the burden of heavy losses.
At its peak, drought covered two-thirds of the continental United States, including prime crop territory in the Plains and Corn Belt. Persistent drought imperils this year's winter wheat crop and may mean a dry start for corn, soybeans and other spring-planted crops.
Crop insurance is the major federal farm support, ahead of traditional subsidies, due in part to sky-high commodity prices and the popularity of so-called revenue policies that shield growers from low prices and poor yields.
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