Members of Congress question viability of crop insurance for hemp

Congressional agriculture leaders from both parties are asking whether crop insurance for hemp will be workable.

The crop insurance challenge came up Thursday in the House Agriculture Committee, where Democratic Chairman Collin Peterson of Minnesota expressed doubts that hemp could be insured in the near future, given how little is known about producing it at commercial scale.

“I don’t see how in the world you’re going to come up with a product for hemp,” Peterson told Bill Northey, undersecretary for farm production and conservation at the U.S. Department of Agriculture.

Northey visited the committee for an update on last year’s Farm Bill, and the exchange was reported by IEG Policy, an agribusiness news site.

Northey acknowledged USDA sees “challenges coming up with a product (for hemp) that fairly represents the risk, and understanding how it should be priced.”

Last month the USDA announced that farmers producing hemp for fiber, flower or seeds will be eligible for 2020 crop insurance coverage under the Whole-Farm Revenue Protection (WFRP) program. However, no USDA-backed insurance is available just for hemp, and farmers can’t buy WFRP hemp coverage until the USDA finishes writing the rules for how the crop can be grown.

The top-ranking Republican on the committee, Texas Rep. Mike Conaway, said legalizing hemp has “opened a Pandora’s box.”

“If a hemp plant is stressed through drought or lack of water, the THC levels skyrocket,” Conaway said.” So we’re going to be insuring an illegal product if we’re covered by crop insurance.”

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