Want Healthier Soil? Link it to Crop Insurance

Scientists now say incentivizing soil health would improve food security and sustainability, especially as the climate changes.


Most farmers know that the health of their soil is important, but they don’t all prioritize it over, say, maximizing what they grow each year. Now, some scientists are looking into ways to ensure that more farmers—especially those producing commodity crops in the middle of the country—start taking soil seriously.

The world’s biggest crop insurance program, the U.S. Federal Crop Insurance Program (FCIP) provides coverage to help farmers recover from “severe weather and bad years of production.” But recently, a pair of Cornell University scientists looked at what might happen if crop insurance were also tied to soil quality—that is, if insurance companies began considering soil data when determining rates.

In a new paper, Cornell University assistant professor of agricultural business and finance Joshua Woodard and post-doctoral research assistant Leslie Verteramo Chiu argue that tying the Crop Insurance Program to the health of a farm’s soil could make it a powerful tool for promoting more sustainable and resilient farming. Including soil data in crop insurance criteria, they write, would “open the door to improving conservation outcomes” and help farmers better manage risks to food security and from climate change.

Or, as Paul Wolfe, National Sustainable Agriculture Coalition (NSAC) senior policy specialist, explained, “The big picture is that crop insurance could be a great way to incentivize conservation, but it isn’t now.”

Current Program Fails to Recognize Conservation Practices

What is the FCIP and why are its policies so influential? The program began in the 1930s to help farmers recover from the devastating losses of the Dust Bowl and the Great Depression. Now it covers everything from drought-related crop losses to dips in revenue.

About 900,000 farmers participate in the program, which currently covers about 90 percent of “insurable” U.S. farmland—more than 298 million acres in 2015—with policies worth about $100 billion annually. And it covers more than 100 different crops. The program is a public-private partnership managed by the Federal Crop Insurance Corporation, which has been administered by the U.S. Department of Agriculture’s (USDA) Risk Management Agency (RMA) since 1996. The USDA sets insurance rates and authorizes which private insurance companies can sell policies; the costs of premiums are subsidized by the federal government to the tune of $0.62 per $1. It’s the largest direct subsidy program to domestic commercial agriculture and currently costs U.S. taxpayers about $10 billion annually.

The USDA itself has said that, “Improving the health of our Nation’s soil is one of the most important conservation endeavors of our time.” Healthy soil is also key to helping farmers manage the extreme weather—including droughts and floods—that comes with climate change.

But as it stands, the FCIP bases premiums on what a farm produces from year to year, without considering the conditions—such as soil quality—that influence those yields. “Crop insurance doesn’t really look beyond what you do in a single year,” said NSAC’s Wolfe. “Its goal is a very short-term effort based on the maximum a farmer can produce in one year,” he explained. “In some ways it discourages conservation practices with its extreme short-term view.”

This means that a farmer who puts in a cover crop to rebuild its soil capacity could end up paying more in premiums if that practice reduced his or her annual yield. Similarly, a farmer who puts marginal land into production to increase yields while increasing erosion or runoff would not pay a price for those impacts.

As Woodard writes, including soil type and quality information in setting crop insurance rates would be “a first step toward creating a crop insurance system” that could improve agricultural sustainability and “improve conservation outcomes.” But without this information, the program doesn’t provide any incentive for farmers to adopt practices that would, for example, increase soil water retention or increase soils’ organic matter—potentially increasing long-term productivity.

If soil data were part of crop insurance, it could also reduce the agricultural runoff now causing damaging algae blooms in the Great Lakes, Chesapeake Bay, and Gulf of Mexico, said Wolfe. And it would do so “with a carrot, not a stick.”

“As a farmer, I have always resented that the price my neighbors—who don’t do a good job with conservation—pay is the same as what someone who does practice conservation [pays],” said Bruce Knight, principal of Strategic Conservation Solutions and former chief of the USDA’s Natural Resources Conservation Services, who raises calves, corn, soybeans—and some years, wheat, sunflowers, and alfalfa—in South Dakota.

“We’re now subsidizing riskier operations the same as less risky ones, Knight explained. Getting information about soil “incorporated into crop insurance will completely revolutionize how that works and revolutionize taxpayers’ role as well,” he added.

Critics of the current program, including the Environmental Working Group, contend that crop insurance policies actually encourage—and subsidize—poor farming practices and could lead to another Dust Bowl in regions hardest hit by drought and heat.

Challenges of Transforming the Farm Landscape

Of course, changing the farm landscape won’t be as easy as some might hope. “Every farmer knows that … improving soil health reduces risk,” explained Meridian Institute senior partner Todd Barker. “But to effect change in the crop insurance program you have to prove without a doubt, in a data-intensive way, that there’s a correlation between A and B. Insurance companies require that level of detail.”

Through its AGree program, the nonprofit Meridian has been working with academic researchers like Woodard, farmers, conservation groups, and former USDA leaders to develop ways to incorporate soil data into the FCIP.

Linking crop insurance premium subsidies to soil data and measures of soil health would be the equivalent of a safe-driver discount on auto insurance, Wolfe explained. It would reward better practices. But getting the USDA to make such a move won’t be easy. After all, the FCIP has been in place for nearly 80 years and linking crop insurance to soil data would require changes to the Farm Bill—and would require the USDA to share information about crop yields that aren’t now readily available.

“There are some people out there who don’t want to change at all,” says Wolfe. “But a lot of people, if provided the right sort of encouragement and incentives, would be moving the needle on reducing runoff, reducing soil loss, and improving water quality.”

It’s tough to say whether any of this will come to pass in the short term. FCIP changes are expected to come under discussion as the 2018 Farm Bill is debated. But, so far, the agriculture committees mainly appear interested in reducing premium subsidies for the wealthiest farmers and insurance payouts based on inflated post-disaster harvest prices.

Newly sworn-in Secretary of Agriculture Sonny Perdue has voiced support for the crop insurance program. Yet his stance on soil protection and increase resiliency to climate change remains unclear, especially given his past dismissal of climate change science and his investments in companies that sell agricultural chemicals, including fertilizer. Still, Woodard’s paper lays the groundwork to show that if and when the USDA is ready to make a move, soil quality data could play a key role in transforming crop insurance for the better.

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  1. Doug Jackart
    Tuesday, May 2nd, 2017
    Cross border question:

    Would any of this information be able to help farmers in Canada, especially in New Brunswick?
    I am trying to assist small farmers in the Saint John River area around Fredericton to change farming habits as it pertains to use of toxic chemicals being used currently.
    Thank you...Doug
    • Elizabeth Grossman
      Friday, May 5th, 2017
      You might want to check with the Meridian Institute – linked to in the story – to see if they are working with any Canadian farmers or farming groups, or know anyone who is. Also check with the National Sustainable Agriculture Coalition about any programs working with Canadian farmers. The US federal Crop Insurance Program obviously doesn't cross borders but the principles of the data on soil type, soil quality and farming methods should. Hope this helps a bit!
  2. Jim Mikkelsen
    Tuesday, May 2nd, 2017
    How in God's name does a farmer achieve Sustainability, Efficiency, Soil Health & All the Other Warm Fuzzies... When we have been used as a Guinea Pig since 1993 in the U.S. Military's quest to "Own the Weather in 2025"? To be more direct "Fake Weather". After the disaster in 2016 it will take several years to nurse my farms soil back to health...Track ruts from one end of the field to the other!!! My farm lost well over $1M in production, I received under 140k indemnity & the crop insurance company walked away with over $200k profit from my policy! Risk Management? The Farmers & Taxpayers should get their Money Back! What a Scamming, Money Laundering Operation! So, as Always...In the opening comments & discussion of the upcoming Fraud Bill (2018 Farm Bill) we are hearing once again, "We're going to Strengthen Crop Insurance"! How many Farmers would like to see it Strengthened for Farmers... Not the Insurance Companies this time around?
  3. Don Vincent
    Wednesday, May 3rd, 2017
    More and more farmers are being talked into using cheap sewer sludge aka biosolids as a form of fertilizer and "soil enhancer" This is going to be a huge future problem. It is so important to remember that sewer sludge aka biosolids is NOT just poop - it is a concentration of all domestic and industrial pollutants that go down drains and sewers. It has some good stuff in it, which plants can use, but a huge load of thousands of other contaminants.  Please read what independent scientists have to say on this issue -

    Three Informed Views on Sewer Sludge (aka Biosolids)

    Dr. Caroline Snyder - "Land-applied municipal sewage sludge (biosolids) is a highly complex and unpredictable mixture of biological and chemical pollutants. Biosolids generated in our large industrialized urban centers is very likely the most pollutant- rich waste mixture of the 21st century."

    Dr. Marilyn Cameron - "We are concerned that farmers are not being provided adequate information about biosolids and the negative impacts that its use could have on your soils, groundwat...er and surface water sources, livestock health, and property values. Farmers will be the ones left paying the price for any damaged land, contaminated water, or human, wildlife and livestock illnesses, etc. Farmers may also suffer losses resulting from lack of consumer confidence in local foods"

    Dr. Richard Honour - ""Few in any governments appreciate that nearly all chronic diseases are caused by long-term exposure to low levels of environmental contaminants and pollutants. We should be trying to minimize this exposure, not amplifying it. It is time to end land disposal of Toxic Sewer sludge, and look at cleaner, greener alternatives - gasification / pyrolysis."
    Let's get on the right side of history, and use this waste resource to make energy. It is time to stop covering Mother Earth with our cities' toxic sewage.

    And see this link for a great overview of the issues - http://bit.ly/2kehQlP by Dr. Thomas Maler

    Scientists against land dispersed "biosolids"
    Canadian- http://bit.ly/1sb2qOP
    UK- http://www.wte-ltd.co.uk/sewage_sludge_biosolids.html
    US- http://pubs.acs.org/doi/full/10.1021/acs.est.5b01931


    The Green Alternative -  The answer is gasification / pyrolysis ...not simply dispersing this toxic waste on farms and forests -
    see - https://www.youtube.com/watch?v=b7EZjUOywzE
    and see - https://www.youtube.com/watch?v=vcq_soCc6dc
    and see - http://www.cbc.ca/.../plasma-gasification-alberta...
    and see - https://www.youtube.com/watch?v=RUDyKpOyYa4
    lets get energy out of this resource AND rid the environment of these toxins.
  4. Thursday, May 4th, 2017
    We are destroying our soil with current farm practices which are perpetuated by government policy.
  5. Jerry Crew
    Thursday, May 4th, 2017
    I agree crop insurance is the key if we want farmers to adopt conservation measures to sustain production. Simply reduce premiums paid by farmers 25 % if they no-till/strip-till and an additional 25 % if they plant cover crops! These 2 practices alone will solve the problem!

    A monetary inducement always works! Most farmers have little inherent conservation ethic!

    Jerry Crew
    Webb, IA