As crops in the Red Deer area start to grow and another hail season gets underway, high commodity prices and input costs are raising the stakes for farmers this year, said Chris Dyck, with Agriculture Financial Services Corporation (AFSC), Alberta’s provincial crop insurer.
“Hail is a threat every growing season in Alberta because we have one of the highest incidences of hail in the world. But when crop prices and inputs like fertilizer and seed climb as high as they are now – at well-above average levels – hail becomes an even greater concern for farmers because they have so much invested in the ground,” said Dyck. The corporation provides the majority of hail insurance to farmers across Alberta on behalf of the provincial government.
“Now is when many farmers start thinking about hail because as soon as their crops emerge from the soil, they’re vulnerable.”
Dyck added hailstorms in late-May and early June have already triggered several claims under the AFSC straight hail program this spring in southern Alberta. Last year, the first straight hail claim happened on June 4 in the Peace region.
“Crops have an amazing ability to rebound from early season hail damage,” said Dyck. “However, those early storms do often result in reduced plant stands and yields. The later hail strikes in the growing season, the greater the damage because once plants have podded or headed out – usually by mid-July – it’s too late for recovery.”
AFSC paid out just over $25.5 million last year on nearly 1,500 straight hail claims across the province, including Red Deer County. The most severe damage was caused by two major hailstorms – one in early July that tore through crops from Sundre to Red Deer – and a second one on July 18 that cut a wide swath through fields from Millet to Saskatchewan. Several smaller storms also peppered crops with hail in almost every region of the province.
“Last year was a good example of the fact that hail strikes everywhere in Alberta, not just in the highest risk area known as Hail Alley that stretches from Calgary to Edmonton, along the Highway 2 corridor,” said Dyck, adding 2011 was an average hail year for Alberta.
What kind of hail season lies ahead this summer is anybody’s guess, he added.
“If it’s wet and warm, we usually get more hail. If it’s dry, there’s generally less hail. But the weather can change so quickly, it’s impossible to predict,” he said, referring to the dry conditions experienced in 2009. “Parts of the province did end up getting moisture that summer, and we had hail losses of more $30 million.”
Ian Marshall, who farms 5,200 acres south of Red Deer near Bowden, said hail is a big risk every year on his farm. “Our land is pretty spread out, so we seem to get some hail most years.”
Last year was a small hail claim – about 20% damage on 300 acres of canola – but he says August of 2005 is still vivid in his memory when hail season rolls around each year.
“We had 1,300 acres of barley hailed out 100 per cent. We had just come through two dry years and finally had a great crop. We weren’t far from combining. It was the worst time to be hit by hail. Without hail insurance, it would sure have set us back.”
Marshall said he might insure more of his crop than usual this year to cover higher input costs. He added he normally puts hail protection on his canola and most of his barley in June.
An increasing number of farmers are electing to take out straight hail coverage in April with their crop insurance – before their fields are even planted – qualifying them for a 2% premium discount, said Dyck.
“It’s an option we started offering two years ago for producers who want protection the instant their seeds are in the ground – rather than waiting for their crops to emerge and risk early hail damage,” he added, explaining crops that suffer more than 25% hail damage before being insured with straight hail coverage become ineligible for AFSC hail insurance until the next growing season.
“It’s a risk many farmers want to avoid.”
For more information visit www.afsc.ca or call. 1-877-899-AFSC (2372).