The Variable Price Option uses July price forecasts to set prices that better represent current market conditions with premium values known up front, giving premium certainty to producers.

The Variable Price Option is available for producers who want an insured price that reflects market conditions closer to the beginning of the crop year than would be the case with the base price. The prices used under the Variable Price Option are established based on the July price forecasts for each crop, using the same sources as are used to determine the base price for the crop.

The premium is based on how historically prices moved between the base and July forecasts. The premium costs are known in March 2010 regardless of the direction that prices move in July. As a result, producers will pay a higher premium for variable price than those selecting the base price, but could end up with higher or lower dollar coverage. Coverage will still change based on the July price forecast.

The variable price for a crop can increase or decrease by a maximum of 50 per cent in relation to the base price for the crop.

You are not eligible for the Contract Price Option or Crop Averaging Program if you choose the Variable Price Option.

This option must be selected by March 31, 2010.

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The In-Season Price Option utilizes actual crop price averages from current season data.

The In-Season Price Option provides a six-month (September to February) average of current market conditions yet sets premium values up front, giving premium certainty to producers. Producers should be aware that coverage may fluctuate up or down, depending on pricing.

The in-season price for a crop can increase or decrease by a maximum of 50 per cent in relation to the base price for the crop.

An interim payment will be made when the claim is processed. Final payment will be issued after prices are finalized in February 2011.

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Under the Contract Price Option, commercial crops, flax, lentils (large green, red, other), alfalfa seed, canary seed, mustard (yellow, brown, oriental), and identity preserved canola may be insured based on the price at which you have contracted the crop. Organic crops available under this option are flax,lentils (large, green, red, other), oats, mustard (yellow, brown, oriental), feed barley, field peas, hard red spring wheat, hard white spring wheat, durum, Canada Prairie spring wheat, winter wheat, Canada Western extra strong wheat, triticale, fall and spring rye.

The insured price is an average of your contract price and SCIC’s base price based on the amount of crop contracted and your production guarantee. This creates a “blended” price for which you will be insured. The blended price will be used to calculate the coverage and premium for all acres of the insured crop, including those that are not contracted. Your insured price does not guarantee market price.

Most total production, partial production or deferred delivery contracts are eligible. For deferred delivery contracts, the delivery period must be August 2010 or later. The producer must be financially independent from the buyer for the contract to be eligible. SCIC may verify that production contracts were executed.

Eligible contracts must specify the contract price or a price premium (e.g. dollars per bushel or dollars per tonne) and the quantity of grain or number of acres contracted.

A maximum allowable contract price will be set by SCIC for each crop by April 30, 2010, based on contract prices offered by Saskatchewan’s primary contractors. Contract prices will be capped at this value.

You must provide SCIC with a copy of the contract by May 31, 2010. SCIC will use that information to calculate the blended price, coverage and premium for the crop. If you do not provide complete contract details, your insured price will default to the base price for that crop.

For losses due to quality, SCIC will apply standard quality factors; applicable quality factors are not based on quality criteria stated in your production contract nor on the final price of the crop. If the use of standard quality factors places you in a claim position, your claim will be paid using the blended price.

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