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2001 Report to Congress: New and Specialty Crops

Executive Summary | Full Report

The U.S. Department of Agriculture's Risk Management Agency (RMA) realized the largest expansion of pilot programs for new and specialty crops in its history with the introduction of 13 new and specialty crop programs for the 1999 crop year, and 8 new and specialty crop programs for the 2000 crop year. Eleven pilot crop insurance programs were expanded during the 1999 and 2000 crop years. Given the expansion of the program, crop insurance and other risk management tools will soon be available as pilot programs or permanent programs for crops representing more than 90 percent of the value of all crops grown in the United States.

The Agricultural Risk Protection Act of 2000 (ARPA), enacted in June 2000, significantly changed the manner in which RMA conducts research and development for new risk management programs, including crop insurance. The 2001 Report to Congress: New and Specialty Crops is the first edition of this report to address the ARPA changes that have already impacted specialty crops producers and are expected to affect the development of future risk management programs for producers of new (not previously insured) and specialty crops.

RMA has now developed and implemented the processes and vehicles needed to conduct research and development of new programs through private and public organizations. At the same time, RMA continued to maintain and improve existing insurance products and other risk management tools. This report provides information on a number of RMA's major initiatives, on behalf of the Federal Crop Insurance Corporation, to carry out the provisions of ARPA. Those initiatives include:

  • developing and awarding a base contract for the research and development of new risk management tools for producers;
  • training RMA staff in the management of contracts to facilitate the leveraging of resources for new and specialty crops research and development;
  • implementing increased levels of premium subsidies to make the cost of crop insurance more affordable for producers; and
  • planning and implementing a number of projects through contracts, cooperative agreements, and partnerships with various public and private entities.

Projects that are expected to offer significant potential to improve the risk management opportunities for producers of new and specialty crops and the amount of the project award include:

  • Aquaculture Pilot Program Research and Development ($3,603,000)
  • Cost of Production Pilot Program Development ($3,498,000)
  • Revenue Coverage Plans Feasibility Study ($931,000)
  • Fresh Vegetables Pilot Program Feasibility Study ($530,000)
  • Perennial Pathogen Destruction Pilot Program Feasibility Study ($499,000)
  • Quarantine Pilot Program Feasibility Study ($376,000)
  • Hawaii Tropical Fruits and Trees Pilot Program Feasibility Study ($215,000)
  • Cut Flowers and Cut Floral Greens Pilot Program Feasibility Study ($153,000)
  • Organics (Feasibility Study ($151,000)

In addition to the above, approximately 30 pilot risk management programs are currently being tested and evaluated for conversion to permanent programs, published in the Federal Register. Coupled with the new research and development initiatives undertaken by RMA and its private- and public-sector partners, these programs should greatly improve the risk management opportunities for future producers of new and specialty crops.

The report also shows that risk management is no longer confined to crop insurance. Pilot programs are now being tested, researched, and developed for aquaculture species and dairy options; and the first livestock programs should be tested within the 2002 crop year. More information on RMA's pilot programs is listed at the RMA web site: http://www.rma.usda.gov/pilots/.