Farmers look to multi-peril options

Farmers are discussing options for multi-peril crop insurance after crops were wiped out in the Wimmera during a hail storm.

Grain industry leaders say the recent spate of wild weather and storms is a good reason to revisit the merits of multi-peril crop insurance.

Last week, large tracts of crops were wiped out in the Wimmera after a hail storm hit the region.

During September, the southwest slopes and Riverina in southern NSW and parts of Victoria experienced severe frost damage.

Justin Everitt of Aintree Park at Brocklesby in southern NSW inspects his crop of Boree wheat. Justin is also the NSW Farmers grains committee chairman. Picture: Nikki Reynolds

NSW Farmers grains committee chairman and Brocklesby farmer Justin Everitt said multi-peril crop insurance could be a huge benefit.

He said it would enable farmers to protect their crops from damage that can occur due to no fault of their own.

Mr Everitt said yields were ultimately subject to weather events. However, total crop wipeouts were also often the result of weather conditions.

“What we need is multi-peril crop insurance that has government backing,” he said.

“Even our best farmers lose crops due to weather events,” he said.

Mr Everitt said the cost of production was significant, and the recent frost that hit in September was a good example of how widespread damage occurs.

He said it was possible that crops cut for hay may not recoup costs of production.

“Canola seed can cost more than $1000 for a 20kg bag,” he said.

There were other examples when farmers were able to salvage some returns.

Hail stones which caused damage to crops near Horsham.

Mr Everitt said Farm Management Deposit schemes were of benefit to some farmers, but particularly those newer to the industry, it could take a number of years to build up a substantial buffer.

Earlier this year, CSIRO released a report titled Crop Insurance: can it make farming more sustainable? The report discusses the risks associated with agriculture.

“Despite good planning, sometimes the risks can’t be controlled, and farmers wind up losing income.

“They might reduce fertiliser applications when fertiliser prices are high but lose yield as a result.

“Or, suspecting a crop might fail because of drought, they might not apply enough fertiliser to reduce their costs and minimise financial risks, only to find the weather was kind and they lost the opportunity for a good crop,” the report stated.

Birchip Cropping Group chairman and farmer John Ferrier, Birchip, said farmers had recently been hit by a run of challenging weather.

“Insuring for frost or seeking multi-peril crop insurance is not something we have looked into,” he said.

But at the same time, he said there was diversification within the business, including running livestock and cropping side by side.

“As cropping farmers, we tend to carry the risk; it is what we do,” he said.