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The Farm Business

Risk Management

Certain risk management strategies are embodied in Laura and Adam’s approach to farming. Farming as a CSA helps them manage financial risk by getting payments up front for the crops to be produced. The diversity of Laura and Adam’s crops and the nature of succession planting help to reduce the risk of crop failure. The existing hoop house, and the additional ones they hope to acquire, provide protection from hail and wind. The first season of growing crops in the hoop house also suggests that it offers some measure of disease protection.

Adam and Laura do not currently carry crop insurance. Typical programs provide insurance specific to each crop and only reimburse farmers for seeds and possibly a percentage of production, thus making standard crop insurance too complicated for their number of crops and not sufficiently cost-effective. A new program, however, may soon become an option for them. AGR-Lite, which is administered by the USDA Risk Management Agency and offered through private insurers, is a program that compensates farmers for reduced revenue due to covered losses. AGR-Lite allows organic farmers to take into account the anticipated premiums for their crops, which other Federal Crop Insurance programs have not.

Educator’s Perspective:
Resource Tip

Farm Transition Planning

The Farm Transfer and Estate Planning online workshop addresses the transfer of farm businesses to the next generation. The program is targeted at farm family members and involves three focus areas:

  1. introduction of farm transition and estate planning information, laws, regulations, concepts and techniques;


  2. outline of potential strategies farm families can consider as they develop and implement their farm transfer and associated estate plan; and


  3. outline of methods whereby farm family members can develop individual, family, and farm business goals and use those goals to develop a transfer plan outline including their personal transfer team.

AgTransitions helps farmers develop a plan to transition their business to the next generation and includes interaction with reviewers for feedback and assistance.

AGR-Lite first became available in Minnesota in 2007, but Adam and Laura were not eligible until they had five years of documented farm revenue. Now that they are more established, they plan to look into this option as their Gardens of Eagan mentors have done. Laura and Adam do carry insurance policies for general liability, product liability, and workers’ 'compensation.



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