Revenue program protected production costs during drought

2012 marked the second year that MKC worked with Swiss Re to offer a revenue program designed to assist producers manage the risk associated with the production of double crop soybeans. While MKC promoted the program to producers, MKC did not assume any of the financial risk associated with it.

In 2011, the first year the program was offered, Swiss Re paid out over $2.65 million to 138 producers throughout 11 counties.  During the growing season of 2012, the program was utilized by over 200 producers in 21 counties. Approximately $2 million will be paid to those producers.

MKC was the first in the nation in 2011 to offer this one-of-a-kind program to producers when double crop soybeans weren’t traditionally eligible for federal crop insurance. Following the program laid out by MKC, several other vendors in the state adopted similar programs.

The risk associated with double crop beans is typically weather related, drought being the largest issue over the past two years.

“Due to unfortunate growing conditions the vast majority of fields have seen yield reduction which will result in a significant number of customers receiving payments,” said Dave Spears Chief Marketing Officer for MKC.

"While the growing conditions were unfortunate, we are fortunate in that we were able to offer this risk management tools to our members," stated Spears.