What are the USDA's Hemp Crop Insurance Programs?

This year, the U.S. Department of Agriculture (USDA) made its new insurance program pilot available to farmers. These programs have helped legitimize the hemp-growing business since they not only cover for the production of fiber, flower, and grain but also Cannabidiol (CBD) oil.

These insurance programs protect farmers from different types of disasters, something they’d been waiting for since the 2018 Farm Bill. The first of the two programs is the Multi-Peril Crop Insurance (MPCI), which covers loss of yield as a result of insurable causes for hemp failure. The second one is the Noninsured Crop Disaster Assistance Program (NAP) for areas with no permanent federal crop insurance program.

What’s the difference between MPCI and NAP

The Multi-Peril Crop Insurance (MPCI) program covers only selected counties of 21 states. You can find these counties in the USDA Risk Management Agency’s Actuarial Information Browser.

To be eligible, cultivators should have been growing hemp for at least a year and apply with 5 acres of CBD and 20 acres of grain and fiber as minimum acreage requirements. Also, this program does not qualify for replant payments or prevented plant payment. 

The Noninsured Crop Disaster Assistance Program (NAP) covers all counties not applying for a permanent insurance program. This program focuses more on losses associated with lower yields, destroyed crops, or prevented planting.

Some other requirements

To apply for these programs, farmers must have a license to grow hemp. They have to comply with all regulations imposed by their state, tribal, or federal authorities. It’s also important to point out that hot hemp (crops that exceed the legal THC limit of 0.3%) become ineligible for insurance.

If you’re interested in applying for insurance next year, you should visit the USDA official site on hemp farming programs.