Crop Insurance's Hunger for Land

It's no secret that federally subsidized crop insurance makes it more attractive to till land that normally would be too wet, steep, lacking in fertility or otherwise "marginal" to raise a profitable crop on. But a recent study out of the University of Wisconsin attaches some solid numbers to just how much marginal land we're losing to the plow, and raises red flags over the impact such conversions are having on our environment and agriculture itself. The study also points out some gaping loopholes in a 2014 Farm Bill provision that was meant to make crop insurance less of a threat to land covered in grass.

The study, which was published earlier this month in the journal Environmental Research Letters, used high resolution satellite data to track how much new cropland we gained in the U.S. between 2008 and 2012, the time period immediately following the passage of the federal Renewable Fuels Standard (RFS), which accelerated the demand for corn-based ethanol and other biofuels. Among other things, the researchers wanted to determine if demand for crops like corn fueled the conversion of previously uncultivated acres.

They found that nationwide, over 7.3 million acres of previously uncultivated land was converted to crops during the study period. Seventy-seven percent of that new cropland came at the expense of grassland—native prairie, pasture and hay ground. Corn was the number one choice for planting on newly broken ground, followed by wheat and soybeans.

About 250,000 acres of uncultivated Minnesota land was converted to row crops during the study period, according to Minnesota Public Radio. Most of those acres were former grasslands, but 25,000 acres had been in wetlands—more than any other state. In addition, 13,000 acres of Minnesota forests transitioned to crops during the study period, which ranks this state second nationally in that category. The perimeters of Minnesota's North Woods saw a cropland expansion of more than 100 percent.

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The satellite imagery examined by the UW researchers shows the Renewable Fuel Standard's goal of reducing greenhouse gas emissions is on rocky ground. According to the law that created the RFS, biofuels may only be sourced from land that was cleared or cultivated prior to December 2007. That requirement is a recognition that the environmental benefits of biofuels can be quickly wiped out by releasing carbon into the atmosphere to produce corn and other crops to feed energy factories. But the study shows that nationwide 3.5 million acres of corn and soybeans growing from 2008 to 2012 were on new, rather than pre-existing, cropland, which would make them potentially ineligible for producing biofuels under RFS.

Carbon emissions produced from corn and soybeans planted on recently tilled land would be equivalent to a year's carbon dioxide release from 34 coal-fired power plants, or 28 million cars, according to the UW study. Given that major impact, the researchers conclude that stricter enforcement of rules around expanding cropland for biofuels production are needed.

"We could be, in a sense, plowing up prairies with each mile we drive," Tyler Lark, one of the study's authors, quipped in a UW press release.

Lark and his colleagues also call out another federal program—crop insurance—as in need of modification in order to stem the tide of land conversion. By providing generous subsidies for insurance premiums, the program removes much of the risk of farming land that would normally be considered too marginal to produce a profitable yield. When federally subsidized crop insurance was greatly expanded in the 2014 Farm Bill, it had a "sodsaver" provision attached to it that limits insurance premium subsidies on acres converted from native sod after January 2014.

Unfortunately, that rule only applies to six states—Minnesota, Iowa, Montana, Nebraska, North Dakota and South Dakota. These states accounted for 36 percent of the documented cropland expansion on previously unbroken land from 2008 to 2012. That leaves a whole lot of farmers in a whole lot of states who can break new ground and still receive the full benefits of crop insurance premium subsidies. It should also be pointed out that the sodsaver provision does not prevent conversions of forests or other native ecosystems, which has greatly benefited R.D. Offutt Corporation’s efforts to convert timber to potatoes in Minnesota.

When you have more prairies, pastures and other perennial systems going under the plow at rates not seen since the run-up to the Dust Bowl, the environmental consequences are bound to be dramatic. Besides all that lost carbon, soil is being eroded and wildlife habitat is vanishing. And even if the land being converted is not pristine grassland, it's bad news for the environment. Marginal land—rocky pastures, steep hillsides, boggy bottoms—also provides innumerable ecosystem services. According to the Environmental Research Letters paper, during the study period, "…total marginal cropland area expanded at twice the rate of cropland on well suited soil."

Losing marginal land also means eroding our base of opportunity for beginning farmers. Historically, marginal land has often been more affordable, providing new farmers with a relatively low cost entry into agriculture. Many a pasture-based livestock operation was started on land otherwise not suitable to raise row crops on. The Environmental Research Letters study shows that areas of southern Iowa and northern Missouri—a region dominated by hilly land perfect for livestock grazing and not so good for raising bin-busting crops of corn—were converted into row crops at an alarmingly high rate from 2008 to 2012. As the Land Stewardship Project's recent white papers show, by inflating the price of land, crop insurance has helped put such acreage out of the price range of farmers who are just getting started or otherwise don't have access to large financial resources.

One thing has changed since 2012: prices for commodities like corn and soybeans have taken a major tumble, and high crop prices certainly played a factor in the big plow up. But the mechanics of another major factor in all those acres being converted—crop insurance—are the same. In fact, with the major expansion of crop insurance in the last Farm Bill, it is certain to play an even bigger role in incentivizing the tilling of marginal land. Perhaps no federal farm program today has more influence on what land is planted to what crop. Expanding sodsaver to more states may help save soil, but it's not the ultimate answer, particularly for beginning farmers.

The most recent land conversion statistics provide one more argument for not just tinkering with what was once a good basic safety net for farmers but has evolved into a mechanism for harming our landscape and the people who live on it. Nothing short of major reform will do.

Brian DeVore is the editor of the Land Stewardship Letter.