United States farmers lose their crops to drought and flooding every year, but for some, the next Farm Bill to be considered by Congress in 2023 could change that. Current policies do not require or encourage farmers to adapt to climate change or to cut their emissions. Because of this, worsening drought conditions in Texas have resulted in multiple years of insurance payments to the same farms.
Studies show that drought exacerbates crop damages from heat because hot air sucks more moisture from the ground and nearby crops. Future federal farm policies could encourage farmers to adapt in ways (such as implementing cover crops, crop rotations, etc.) that would prevent such a loss from drought.
Because drought conditions continue to worsen especially in farming areas like Texas, the amount of money from insurance payouts has risen dramatically over the past 25 years. The Environmental Working Group’s new crop insurance database found that insurance payouts to farmers due to crop loss from drought amounted to $1.65 billion in 2020 which was a 400% increase from 1995 when $325.6 million in payouts were distributed to farmers.
When the cause of loss was excessive moisture (flooding, hail, etc) payouts rose by nearly 300% during the same time. In 2020, $2.6 billion were paid out compared to just $685.4 million in 1995. These two causes of loss alone account for more than 60% of the total insurance payouts between 1995 and 2020.
The EWG’s study found that the top 10 payouts per county due to drought all occurred in Texas, while Brown County, South Dakota took the top payout of any county due to excess moisture. The rest of the top 10 insurance payouts per county due to excess moisture all occurred in North Dakota.
Top 10 insurance payouts per county due to drought vs excessive moisture
According to the EWG’s article, some of the insurance money farmers get come from the money they pay, but “taxpayers largely fund additional payments when losses exceed premiums.”