To Harvest, or Not to Harvest Flooded Crops
Many crops were flooded during and after Hurricane Matthew in early October, and questions abound as to whether to harvest those crops or not. NC State Agricultural Economist Dr. Nick Piggott applied pencil to paper to assist farmers in making that decision:
“There’s some very simple math that a grower needs be able to do; they need to be able to calculate what their break-even yield is to be able to put the combine in the field.
In order to calculate that, you need to know two pieces of information; what is your harvest cost per acre, and for soybeans that typically comes to about $40 per acre, and that includes putting the combine in the field, plus taking the grain to your buyer.
And you also need to know, and this is why I was encouraging farmers to talk to their local grain buyer, what price you’re going to net when you take it to the buyer.”
Piggott uses soybeans as an example:
“So, for example, if your harvest costs are $40 an acre, and you can get $10 per bushel for your soybeans, your break-even yield is four bushels per acre. So, if your beans don’t look like, when your insurance adjuster does an appraisal,to be more than four bushels an acre, it’s not worth your while to go and harvest those beans, you should just take the appraised value.”
It comes down to simple economics, explains Piggott:
“When it comes to this decision, if you have insurance, you can have a choice of either taking the appraised value, and making really important that you know what your yield guarantee is, which will go towards your production count, and not harvest those beans. But, it still comes down to the basic economics, if you can harvest more than your break even yields, it is more profitable to go harvest those beans.
But, you have to be sure that you can net the price that you think you’re going to be able to get. That’s why you need to take a sample to your local buyer.”
Another factor at play is flood waters in fields, and where that water came from. Piggott explains:
“This is obviously a two-pronged decision; but subject to one other condition, and that condition is if flooding was involved, before moving forward with harvesting you need to determine whether the flood was from what is being termed as ‘flooded waters’, or ‘pooled waters’.
Flooded waters is essentially water that comes from somewhere else, like a river, or another field. Pooled waters are considered just vertical rainfall.
So, if you have flooding from flood water, the crop is considered adulterated, and should not be harvested, even if you can get more than your break-even yield. That crop should be destroyed, and for insurance purposes, your production to account would be valued at zero.”