Farm Credit Services of Mandan IMPORTANT MARCH 15 DEADLINE 2016 CROP INSURANCE UPDATE. Winter 2016

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1 Farm Credit Services of Mandan Winter 2016 Farm Credit Services crop insurance department works with several selected insurance carriers. Together we stay current with the new product options and changes in procedures. We encourage you to explore all the new opportunities that exist with risk management through all the various crop insurance options. Our team of crop insurance specialists can help you select the right level of coverage to protect your investment and profits. We appreciate your business and look forward to helping you with your risk management needs. IMPORTANT MARCH 15 DEADLINE New applications Add crops or delete crops Add county or delete county Change plans (Yield Protection, Revenue Protection, etc.) Change levels of coverage Winter coverage option barley, canola, dry peas and winter wheat Transfer or cancellation of existing MPCI policies Written agreement requests (including new breaking and native sod) Added county election Enterprise units All options: Yield Exclusion Substitution of yields (YA) Canola two-year rotation option Malt barley option Personal T-yield (PTY) High-Risk Land Trend Adjusted Yields Supplemental coverage option Private Products Whole Farm Revenue Protection Beginning Farmer and Rancher Benefits Note: All these changes require your signature, so please contact your Farm Credit Services agent to review your coverage for the 2016 crop year. Your crop insurance policy(s) will remain in force for 2016; unless you indicate otherwise CROP INSURANCE UPDATE New Malting Barley Endorsement (MBE) The new MBE replaces the current Malting Barley Price and Quality Endorsement which no longer will be available to producers. MBE allows a producer to elect either yield protection or revenue protection. MBE insures a producer s malting barley with prices established in accordance with the malting contract (under terms of MBE), and provides additional quality protection for production that does not meet the quality specifications of the contract or Special Provisions (except seed). There are three ways to insure Malting Barley: 1) Yield Protection or Revenue Protection based on prices determined by the Commodity Exchange Price Provision no additional quality coverage 2) Yield Protection based on a price contained in a production contract no additional quality coverage 3) Yield Protection or Revenue Protection with additional quality protection provided with the Malting Barley Endorsement Conservation Compliance To be eligible for the premium subsidy on a federally reinsured crop insurance policy of any type, the insured must file a Highly Erodible Land Conservation and Wetland Conservation (form AD-1026) with the Farm Service Agency (FSA). To be eligible for the premium subsidy for 2016; insured must have filed a form AD-1026 with the FSA certifying his compliance with HELC and WC provisions on or before June 1, For 2016 Only New producers that started farming after June 1, 2015, must complete a New Farmer Certification statement and an AD-1026 within 45 days after March 15, Carinata A Special Provision statement has been added to all canola/ rapeseed and mustard program counties. Carinata is insurable with a processor contract and a written agreement under the Canola and Rapeseed Crop Provisions.

2 2016 CROP INSURANCE UPDATE cont. ACTUAL PRODUCTION HISTORY (APH) Added Land Procedure Changes Risk Management Agency (RMA) is no longer requiring added land and new crop/practice/type requests for total added land acres less than 2000 cropland acres. The higher of the applicable Variable T-Yield, SA T-Yield, or PTY (if elected) will be used to establish the approved APH yield. The County T-Yield or a percent of T-Yield will be applied if the total cropland acres added exceed 2000 acres. Whole-Farm Revenue Protection (WFRP) WFPR Pilot plan of insurance provides a risk management safety net for all commodities on the farm under one insurance policy. The insurance plan is tailored for any farm with up to $8.5 million in insured revenue, including farms with specialty or organic commodities (both crops and livestock). The WFRP provides protection against the loss of revenue that the producer expects to earn, or will obtain, from commodities produced on the farm during the insurance period. Claims are settled after taxes are filed for the insurance year. A loss under the WFRP policy occurs when the WFRP revenue-to-count for the insured year falls below the WFRP insured revenue. For the Whole Farm History Report, the insured must provide 5 consecutive years of Schedule F or other farm tax forms ( ). Whole Farm Revenue Protection is available in all counties in all 50 states. WFRP application and Intended Farm Operation Report deadline for coverage is March 15, North Dakota Actuarial Changes Yield Exclusion added crops: Buckwheat, Dry Beans, Dry Peas, Flax, Forage Production, Mustard, Oats, Rye, Safflower Trend Adjustment added crops: Barley, Dry Beans Trend Adjustment some factors updated, various new counties (review information with FCS crop insurance representative) 80% & 85% coverage level additions: Barley, Oats Wheat quality adjustment Discount factor changes for grade, test weight, and vomitoxin Damage discount split into two charts winter and spring Falling number new discount chart to include winter wheat If you have not reported your production for 2015, please report it to your FCS insurance agent as soon as possible. Substitution of Yields (YA) If APH data contains yields lower than 60% of the county T-yield, the insured may choose to replace those low yields with 60% of the county T-yield. This will increase your APH guarantee. Premium is calculated on actual yields and may increase under this election. North Dakota Personal T-Yield (PTY) Crop rotation requirements limit the ability of North Dakota policyholders to accumulate four years of actual records for a unit. With less than four years of actual records, the unit must use standard APH procedures (a county T-yield, a variable T-yield, or a simple average yield). The North Dakota PTY Pilot Program will more accurately reflect a producer s actual production capability. The program calculates a personal T-yield for a producer by combining all production and acres for a crop of the same practice/type/ variety/t-yield map area. This yield would then replace the T-yield in those units for the corresponding crop year(s). Yield Floor The yield floor is a percentage of the applicable T-yield based on the number of years of history the insured has provided for the crop and county. Yield Cups Approved APH yields may not decrease by more than 10% compared to the previous year s approved APH. If applicable, the Yield Floor and Yield Cups procedures will automatically be applied when updating APH databases. Trend-Adjusted Yields Trend-Adjusted (TA) yields for North Dakota are available for: wheat (entire state), barley, canola, dry beans, sunflowers, corn, and soybean (specific counties). Trend adjusted yields may increase yields in qualifying APH databases. Trend adjustments are made on each eligible yield within a qualifying database based on the county s historical yield trend, which is provided in the county actuarial documents. Insureds must be in an eligible county and have at least one APH database with an actual yield in one of the four most recent crop years for the crop/county. If the APH database contains fewer than four actual yields in the 12 most recent crop years, the trend adjustment is reduced. TA does not apply to CAT policies, APH databases with T-yields, PTY yields, SA T-yields, or new producer T-yields. Actual Production History (APH) Yield Exclusion RMA has identified eligible crop years in which producers may elect to exclude actual yields from their actual production history. Crop years are eligible when the average per planted acreage yield for the county was at least 50 percent below the simple average for the previous 10 consecutive crop years. Yield Exclusion Eligible Crops: Barley, Buckwheat, Camelina, Canola, Corn, Dry Beans, Dry Peas, Flax, Forage Production, Mustard, Oats, Rye, Safflowers, Soybeans, Sunflowers, Wheat

3 ACRES WITHOUT PLANTING HISTORY Acreage Emerging from USDA Program (CRP) within the two most recent years (that is being planted to a crop for the first time since emerging from USDA Program) is insurable under the terms of the policy. APH will be limited to 100% of the applicable T-yield (if no production records available). Acreage emerging from CRP (that is not planted within two years of emerging from CRP) may be insurable by requesting a Written Agreement by March 15, (Refer to new breaking procedures.) Note Acres emerging from USDA Program and new breaking acres are not eligible for: Prevent Plant coverage the initial crop year. Simple average T-yields, added land procedures, personal T-yields, or master yields. New Breaking Acreage is insurable if the land has been planted and harvested or insured in any one of the three previous crop years (including insured acreage that was prevented from being planted). Acreage is not insurable if the only crop that has been planted and harvested in the three previous crop years is a cover, hay (except wheat harvested for hay) or forage crop (except insurable silage). Exceptions to the rule is if land was not planted to comply with another USDA program, such as CRP, acreage has been part of a normal rotation, or if acres are 5% or less of the insured planted acreage in the unit. APH will be limited to 50% -80% of the published T-yield. New breaking coverage requests must be completed by March 15, Native Sod Producers benefits will be reduced during the first four crop years of planting on land that is converted from native sod to the production of an annual crop (when acreage is greater than five acres per crop policy). The producers benefits affected are a reduction of premium subsidy, a reduced insurance guarantee, and the elimination of yield substitution. Livestock Risk Protection (LRP) is designed to insure against declining market prices. Producers may select from a variety of coverage levels and periods of insurance that corresponds with the time their market weight livestock would be sold. Producers can choose from contract weeks (varying from 13 to 52 weeks), weight, coverage level, and number of livestock they want to insure. This insurance is available for cattle, lamb, and swine and can be purchased continuously or throughout the year. The insured must have possession of the cattle at the time the insurance is purchased and must retain ownership of the cattle up to 30 days prior to the contract end date. INSURANCE PLANS Insurance plans provide different types of insurance coverage to specific crops: Actual Production History (APH) policies insure producers against yield losses due to natural causes such as drought, excessive moisture, hail, wind, frost, insects, and disease. The producer selects the level of coverage (50%-85%). The price is established annually by RMA. If the harvested production plus any appraised production is less than the yield guarantee, the producer is paid an indemnity based on the difference. Yield Protection policies insure producers in the same manner as APH policies, except a projected price is used to determine insurance coverage. The projected price is determined in accordance with the Commodity Exchange Price Provisions and is based on daily settlement prices for certain future contracts. Revenue Protection policies insure producers against yield losses due to natural causes and revenue losses caused by a change in the harvest price from the projected price. The producer selects the levels of coverage (50%-85%). The projected price and harvest prices are determined in accordance with the Commodity Exchange Price Provisions and are based on daily settlement prices for certain future contracts. The amount of insurance protection is based on the greater of the projected price or the harvest price. If the harvested production plus any appraised production multiplied by the harvest price is less than the amount of insurance protection, the producer is paid an indemnity based on the difference. GENERAL INFORMATION Beginning Farmer/Rancher Benefits (BFR) Beginning farmers and ranchers are eligible for certain benefits designed to help farmers/ranchers as they start their operation. To qualify for BFR status, an individual must not have actively operated and managed a farm or ranch with an insurable interest in any crop or livestock in any county/state for more than five years. Insurable interest may exclude any crop year: under the age of 18, post-secondary studies, or on active duty in the U.S. Military. Benefits will include: Exemption from paying the administrative fee for catastrophic and additional coverage policies Additional 10 percentage points of premium subsidy Use of the production history of farming operations that BFRs were previously involved in the decision-making or physical activities of a farm or ranch operation An increase, from 60 to 80 percent of the applicable yield (T-yield), when replacing a low actual yield due to an insured cause of loss New Producer RMA is instructing Insurance Providers to verify whether an insured is a New Producer. Specifically, the policyholder must certify on the production report that he/she has not been actively engaged in farming for a share of the production of the insured crop in the county for more than 2 years. Summerfallow Date To qualify as a summerfallow practice, acreage must be chemically or mechanically fallowed on or before June 15, 2016, for crop year 2017.

4 GENERAL INFORMATION cont. Unit Options Basic units Enterprise units Optional units Whole Farm units Enterprise Units Available for crops with revenue or yield protection coverage. Acres planted in more than two sections, the acres can be aggregated to form at least two parcels to meet the 20/20 requirement. Acres used to determine the enterprise unit discount include insured planted acreage in the unit (does not include prevented planting acreage). Separate enterprise units and coverage levels for Irrigated and Non-Irrigated Written Agreements (WA) The deadline to request coverage with a Written Agreement is March 15, If you intend to plant a crop, or a type/practice that is not insurable in a county, production history for that crop or similar crop may be needed to complete the request. Requests will be sent to the Regional Services Office in Billings, MT, for acceptance, rating, or rejection. Corn-Grain Written Agreement Guidelines Requests in counties where only non-irrigated corn silage insurance is offered. Records for at least three (3) crop years of ALL non-irrigated corn acreage in the county (grain and silage): At least 50% of all planted corn acreage harvested as grain or grain appraisals in 3 of the 4 most recent years One (1) of those years, at least 50% of corn acreage actually harvested as grain Producers will be able to request a Written Agreement without three years of records if the producers have fully executed an acceptable processor contract. Processor contract must be submitted with the (WA) request Important: Records must be based on harvested grain or grain appraisals. Production history CAN NOT be based on conversion from silage records to corn grain records Added County Election For producers who obtain land in an added county after sales closing (March 15), the Added County Election requires an individual to insure all crops in all added counties in which they have a share. Insured must designate by county/crop which insurance level, price election and options will apply by the sales closing date. Billing Dates July 1, Rye, Forage Production August 15, Spring Crops September 1, Pasture, Rangeland, Forage (PRF) Interest will begin to attach on unpaid premium on the first of the month following the date of the bill, provided that a minimum of 30 days has passed from the billing date published above, regardless if there is an outstanding claim. Ineligible Tracking Systems (ITS) is the system used by crop insurance companies to monitor policyholders, by social security number, who have not paid their insurance premium and are ineligible for crop insurance. Ineligibility includes: delinquent debt (including premium, interest, administrative fees, indemnity overpayments, and any other penalties). CROP ROTATION REQUIREMENTS Buckwheat Insurance will not attach to any acreage on which canola, crambe, chickpeas, dry beans, mustard, rapeseed, soybeans or sunflowers have been planted in the preceding crop year or on which buckwheat has been planted in either of the preceding two crop years. Canola Insurance will not attach to any acreage on which canola, crambe, chickpeas, dry beans, mustard, rapeseed, or sunflowers have been planted in either of the two preceding crop years (three-year rotation) with the exception below: In a two-year rotation, canola, crambe, chickpeas, dry beans, mustard, rapeseed, or sunflowers cannot have been planted in the preceding crop year and a blackleg resistant variety (MR-R) must be planted with the insured providing proof of variety by the acreage reporting date. A rate surcharge will apply. Dry Beans Insurance will not attach to any acreage on which dry beans, canola, crambe, mustard, rapeseed, soybeans or sunflowers have been planted in the preceding crop year. Dry Peas The following rotation statement applies to the Spr Lentils Type: Insurance will not attach to any acreage on which lentils were planted in either of the previous two (2) crop years or on which chickpeas or field peas were planted in the previous crop year. This statement applies to field peas, lentils, and chickpeas grown either as a grain, cover crop or in a cover crop mixture. The following rotation statement applies to Spr Austrian Peas, Spr Forage/Feed Peas Grown For Seed and Spr Smooth Green or Yellow Types: Insurance will not attach to any acreage on which field peas (Austrian Peas, Forage/Feed Peas Grown for Seed and/or Smooth Green or Yellow Peas) were planted in either of the previous two (2) crop years or on which chickpeas or lentils were planted in the previous crop year. This statement applies to field peas, lentils, and chickpeas grown either as a grain, cover crop or in a cover crop mixture. The following rotation statement applies to Spr Large Kabuli Chickpea, Spr Small Kabuli Chickpea, and Spr Desi Chickpea Types: Insurance will not attach to any acreage on which chickpeas (garbanzo beans) have been planted in any of the three previous crop years. This statement applies to chickpeas grown either as a grain, cover crop or in a cover crop mixture. Applies to all dry pea types: Chickpeas that were planted and then all plant growth is terminated by chemical or mechanical means, prior to June 15, 2015 will not be considered planted for rotational purposes only. The insured is responsible to provide proof of insurability. Mustard Insurance will not attach to any acreage on which crambe, mustard, canola, chickpeas, dry beans, rapeseed, or sunflowers have been planted in the preceding crop year. Potatoes Insurance will not attach to any acreage on which potatoes or sunflowers were planted the preceding crop year. Safflower Insurance will not attach on any acreage on which safflower, sunflower seed, any variety of dry beans, soybeans, mustard, rapeseed, or lentils were grown the preceding crop year. Insurance shall attach to a crop following a cover crop. Contact your agent for details. Sunflowers Insurance will not attach to any acreage on which sunflowers, canola, crambe, dry beans, mustard, rapeseed, or safflower have been planted in the previous crop year. Rotation Statement Applies to canola, dry beans, mustard, sunflowers A crop which was planted and then all plant growth was terminated by chemical or mechanical means prior to the June 15, 2015, will not be considered planted for rotation purposes ONLY. The insured is responsible to provide proof of insurability.

5 Farm Credit Services Crop Insurance Specialists Diana Schulz Beulah Branch Yvonne Seidler Carson Branch Phyllis Meidinger Wishek Branch Debbie Zillmer Wishek Branch Carla Tausend Director of Insurance Services Mandan Association Carla Nelson Mandan Branch Sara Clement Mandan Branch Jan Green Mandan Branch Kristi La Framboise Washburn Branch Penny Hoesel Washburn Branch Holly Ebner Mott Branch Jacky Schaible Mott Branch Jessica Duletski Dickinson Branch Kevin Hilton Bowman Branch NOTICE The information in this newsletter is as current and accurate as possible; however, it is subject to change. Farm Credit Services of Mandan and its employees are not liable for any errors or omissions. Beulah 213 Highway 49 North P.O. Box 507 Beulah, ND Bowman 107 Highway 12 West P.O. Box 859 Bowman, ND Carson 108 First Avenue East P.O. Box 199 Carson, ND Dickinson 1324 W. Villard Street Dickinson, ND Mandan 1600 Old Red Trail P.O. Box 5001 Mandan, ND Mott 320 Pacific Avenue P.O. Box 249 Mott, ND Washburn 1157 Border Lane P.O. Box 158 Washburn, ND Wishek 1207 Beaver Avenue P.O. Box 616 Wishek, ND

6 Crop Insurance Newsletter Farm Credit Services of Mandan P.O. Box 5001 Mandan, ND PRSRT STD U.S. POSTAGE PAID PERMIT #419 BISMARCK, ND Farm Credit supports agriculture and rural communities with reliable, consistent credit and financial services, today and tomorrow. SPRING PLANTING REMINDERS RMA Clarification on Prevent Plant Acreage is considered physically unavailable for planting if acreage has not been 1) insured under an FCIC policy, 2) planted to an insured crop using good farming practices, 3) harvested, 4) in at least one of the four most recent crop years (crop years immediately preceding the current insured crop year). Exception: Unless acreage was planted, insured, but not harvested due to an insured cause of loss and subsequently adjusted for claims purposes. Acreage will be considered physically unavailable for planting until the acreage has been planted to a crop in accordance with items 1-4 for two consecutive crop years. Prevented Planting Prevent Plant coverage, if applicable, may be available when a policyholder is prevented from planting an insured crop due to an insured cause of loss that is general to the area. Insured is required to submit a notice of loss within 72 hours after the final plant date or upon determination of not being able to plant the insured crop. To be eligible for Prevent Plant, new producers must complete an intended acreage report for the county by March 15. Acreage with a preexisting condition is not eligible for Prevent Plant coverage. Spring Projected Price will be used to calculate the prevented planting payment. There will be no additional payment if the Harvest Price is higher. New breaking acres and acres emerging from CRP are not eligible for Prevent Plant. SPRING PLANTING REMINDERS cont. Prevent Plant Acres will still be rolled to the next closest liability; however, the Prevent Plant payment cannot be greater than the original Prevent Plant liability. Adding a county after sales closing producers must submit an intended acreage report within 10 days of obtaining acreage in the new county (provided the added county was selected on the original application). Replant Payment To be eligible for a replant payment, you must notify your agent PRIOR to replanting. Chemical or seed representatives cannot determine crop insurance replant payments. Replant payment is not available for CAT coverage. Destroying Acres Do not destroy (hay, graze, or plow) any insured acreage before an appraisal is made by an adjuster. This applies to all insured acres (including forage), even if there is no loss. Acreage Reporting The insured is responsible for the accuracy of information provided for acreage reporting for crop insurance purposes. At loss time, acres will be verified at FSA. Revisions to the acreage report after the reporting deadline can only be made with the consent of the Insurance Company. Acreage measurement services can be requested to verify acres. RMA requires all approved insurance providers to collect acreage reports at the Common Land Unit (CLU) level by farm/tract/field. This is currently how producers are reporting information to FSA. The field level of detail can potentially deliver efficiencies for agents and insureds in the areas of more detailed maps. This process will improve notice of loss information, allowing the adjusting staff to be more efficient and timely.