NMSU branding

New Mexico State University

New Mexico State University

News Center

New insurance plan will protect New Mexico farmers and ranchers

An unavoidable natural disaster or a dramatic swing in market prices no longer has to mean financial catastrophe for New Mexico farmers and ranchers. A newly available program means they can now protect themselves from revenue losses due to unforeseen circumstances.

The Adjusted Gross Revenue - Lite (AGR-Lite) plan of insurance will soon be available in New Mexico. AGR-Lite is a whole-farm revenue protection plan of insurance, where farmers insure their revenue stream, not their commodities.

Right now, crop insurance plans available in New Mexico only cover 16 crops. When AGR-Lite becomes available in New Mexico for the 2007 insurance year, more than 60 crop and livestock commodities will be eligible for coverage.

"Farmers and ranchers in New Mexico face an unprecedented combination of forces, making farming more uncertain and riskier than ever. AGR-Lite will provide a risk management tool for diversified crop and livestock producers not available in the past," said Patrick Sullivan, NMSU Cooperative Extension Service economic development specialist. He, along with Jim Libbin, professor and extension farm management specialist, spent nearly a year developing the New Mexico application.

"The maximum annual AGR-Lite liability of $1 million will cover more than 95 percent of the farmers and ranchers in the state," said Sullivan.

Most farm raised crops and livestock are eligible for protection. AGR-Lite uses a producer's 5-year historical farm average revenue, as reported on IRS Schedule F and the current year's farm plan, as a basis to provide a level of guaranteed revenue for the insurance period.

Additional information on AGR-Lite is available on the RMA Website at: http://www.rma.usda.gov.