Minding Ag's Business

Farmers like John Hohenberger of Leland, Ill. think his state's estimated 2012 county yields are another questionable case of the accuracy of government statistics. He's not believing National Agricultural Statistics Service (NASS) results for DeKalb County, Ill., which pegged yields at 159 bu./acre last month. Some next-door neighbor counties averaged 101 and 102 bu. , but three hit the 140s and one received too few farmer responses to gauge. Hohenberger's 159 bu. county estimate means he will collect only a modest $85/acre on his expensive county-based Group Risk Income Plan insurance payment for 2012 while growers one county over will collect $700/acre for the same 90% GRIP policy. In fact, GRIP policyholders in every county touching DeKalb will collect two to eight times Hohenberger's payout. In the scorched earth counties of southern Illinois, some GRIP payouts will hit $1,300/acre, the University of Illinois estimated.

That means the stakes for an accurate county yield count are high. GRIP coverage pays based on an index of county yields and planted acres, not individual losses. It's a policy that usually works well if your individual yields run above average and in tandem with county trends, as Hohenberger's do. Most years, he averages about 20 bu. above county levels, although he plunged underneath them in 2012.

"There has been more than the usual amount of questioning of NASS data this year, with DeKalb County being one of the counties," emailed University of Illinois Economist Gary Schnitkey, after I asked his opinion. "Typically, yields in adjacent counties do exhibit variations, so that does not necessarily mean there is a problem. We will have Farm Business Farm Management data very soon to compare to NASS. Will see what that looks like. "

Schnitkey did study bushel losses per acre implied by Risk Management Agency data and compared it to the short fall of NASS data from trend yield. He said that approach has some issues, but it does not point out any anomalies.

At last week's Purdue land conference, I ambushed Greg Matli, deputy director of Indiana's Agricultural Statistics, which uses the same yield sampling method to report to NASS that Illinois uses. "It's okay," Matli said when I cornered him. "This has been happening a lot lately...I understand their frustration."

Like Schnitkey, Matli says variability between counties is nothing new, especially after severe weather events. Some counties in Indiana reported average corn yields ranging from 50 bu. to 210 bu. "Extremes are tough to estimate because we have no history and we're dealing with such an abnormal situation," he says.

Some farmers have asked why NASS can't simply use crop insurance records to verify county yields. Matli points out that those reports come long after harvest--maybe even into spring--so they would delay national crop estimates. Plus, he argues crop insurance results "have a bias to the low side" since irrigators and other top producers tend not to participate in Risk Management Agency (RMA) programs.

NASS's procedures have to hold up in court, Matli adds. To assure that no individual is swaying results, the agency needs at least three operators and 30 positive yield s reports per county, or 25% of planted acres. Low farmer survey responses hinder that effort and have forced the RMA to drop GRIP coverage in many counties with light returns. In contrast, some counties report more than 50% of their acres.

"You don't have to respond when a fertilizer or seed company surveys you, but please respond to NASS because we're the only ones who set county yields," Matli says. "Crop insurance reports too late. In fact you have until July 15 to sign up for FSA acres, but there's only a $100 to $125 late fee, so some operators drag out reporting until the end of the year. Yes, we have satellites but the grower is where we put all our weight in these estimates.

"If you don't respond to surveys, we can't help you. If you don't tell us yield, just acres, it doesn't count."

His advice to farmers who think their county yield is off base: Write a letter to the Ag Statistics Board and ask for a review. Meanwhile, fill out those government inquiries. "In fact, I still tell growers if they haven't returned their census data yet, please do it. You can't believe how important it is to report county-level statistics," Matli says.

For more information on Illinois county yields and estimate GRIP payouts go to http://www.farmdoc.illinois.edu/…

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