The Timothy Hay Pilot Program is available on irrigated timothy hay acres intended for export and mitigates the risk associated with this intensively managed crop. All timothy hay acres intended for insurance must meet the requirements of the program’s terms and conditions.
Timothy hay insurance is available for pure, irrigated timothy hay stands intended for export. A map of the insurable areas is available online. Deadline to participate is March 31, 2008.
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Coverage |
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Timothy hay is insured for yield loss and quality coverage based on the 'choice' grade. Producers have the option of selecting one-cut or two-cut coverage. Any producer who planted timothy hay before June 15, 2007 is eligible for full season, two-cut coverage or one-cut coverage in 2008. Crops seeded August 1 to September 15, 2007 are only eligible for one-cut coverage in 2008.
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Premiums and Prices |
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Producers may select coverage at 50, 60, or 70 per cent of their average yield, cost shared at 60 per cent by governments, 40 per cent by producers. Experience discounts and surcharges do not apply.
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Indemnity Calculation Example |
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A customer has three fields of timothy hay, insured for two cuts at 70 per cent coverage with a coverage per acre of 2.5 tonnes. The customer's dollar coverage is:
Field |
Acres |
Production Guarantee (70%) |
$ Coverage |
1 |
90 |
225 T |
29,250 |
2 |
145 |
363 T |
47,190 |
3 |
75 |
188 T |
24,440 |
Total |
310 |
776 T |
$100,880 |
They have the following annual production:
Field |
Acres |
1st Cut Yield |
|
2nd Cut Yield |
2nd Cut Grade |
1 |
90 |
108 T |
Choice |
57 T |
Utility |
2 |
145 |
230 T |
Standard |
115 T |
Utility |
3 |
75 |
100 T |
Choice |
62 T |
Choice |
Total |
310 |
438 T |
- |
234 T |
- |
For this example, assume the quality factors are:
- Choice 1.00
- Standard 0.70
- Utility 0.50
The production adjustment for quality would be:
Field |
Acres |
1st Cut Yield |
1st Cut Adjusted for Quality |
2nd Cut Yield |
2nd Cut Adjusted for Quality |
1 |
90 |
108 T |
108 T |
57 T |
28.5 T |
2 |
145 |
230 T |
161 T |
115 T |
57.5 T |
3 |
75 |
100 T |
100 T |
62 T |
62.0 T |
Total |
310 |
438 T |
369 T |
234 T |
148 T |
Total production before quality adjustment
= 438 T = 234 T
= 672 T
Total production adjusted for quality
= 369 T + 148 T
= 517 T
Total yield loss = 776 T - 517 T = 259 T
Total indemnity = 259 T x $130/T = $33,670 |
As a pilot program, all timothy hay acres will be inspected. Customers must notify Crop Insurance when harvest begins so that an adjuster can visit their farm to inspect acres, count bales and obtain samples. Representative hay samples will be submitted for grading and industry standard grading practices will be used.
Crop Insurance will require the following from each producer:
- the weight of a representative sample of bales from each lot
- a copy of a producer’s field management handbook
Claims will not be finalized until all information is provided. If any production issues arise, including harvest delays due to inclement weather, customers must contact Crop Insurance immediately.
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