Margin Protection Insurance Offers Corn Price Floor Among Changing Markets and Weather

Areas shaded in green show where USDA’s Risk Management Agency expanded margin protection insurance eligibility for 2024 corn. Blue areas already had access. (Map courtesy of www.marginprotection.com)

The Margin Protection crop insurance plan (MPP) is a federally subsidized area-based product that provides coverage against an unexpected decrease in operating margin (revenue less input costs). As a result, it can help farmers navigate volatile markets and weather.

The 2024 price discovery period for the coverage option was August 15 to September 15 (it’s February for most other Midwest crop insurance products). The unofficial projected prices during this period were $5.09 per bushel of corn and $12.95 per bushel of soybeans. As a result, MPP may help farmers growing corn to establish a floor price above $5 per bushel for their 2024 crop. If your pricing strategy suggests that prices will be less this spring, Margin Protection may be a policy to be considered.

Margin Protection considers changes in crop prices, reductions of yields and changes in the prices of inputs used to grow the crop. This area-based plan uses county-level estimates of average revenue and input costs to establish the amount of coverage and indemnity payments. A loss may be paid when the harvest margin is lower than the trigger margin. Any indemnities owed will be paid when final county yields are available in the spring of the following year.

The signup deadline for MPP insurance is Monday, October 2 (September 30, but since that falls on a weekend, it is moved to the next business day).

Due to the variety of factors of MPP related to a farm’s yields compared to county yields, input purchasing practices and hedging strategies, farmers should work with their local trusted ProAg crop insurance agent to determine if MPP is a good fit for their operations.

To learn more about MPP insurance and view a list of FAQs, visit this product page. Read more commentary from DTNPF here.