Contact:
Shirley Pugh (202) 690-0437

BURLEY TOBACCO CROP INSURANCE UNDERGOES CHANGES FOR 2005

WASHINGTON, Feb 15, 2005 - As a result of the recent tobacco quota buyout, the process for determining burley tobacco insurance guarantees will change significantly, beginning immediately for the 2005 crop year.

In past years, burley insurance was based on a marketing quota assigned by the Farm Service Agency (FSA). Elimination of the quota system now requires coverage based on approved yields, as indicated in Quota Tobacco Crop Provisions, calculated from historical actual yields (or county transitional yields in the absence of four years of actual yields).

Insureds have until June 1, 2005, to submit actual production history reports for previous crop years in order to determine their approved yield. More information and details are contained in RMA Bulletin MGR-05-001, dated 2/1/2005, at http://www.rma.usda.gov/news/managers/2005/PDF/mgr-05-001.pdf.

RMA has also provided additional price elections for 2005 crop year flue cured and burley tobacco. The additional price represents the maximum price election for the crop year and is $1.35 per pound for flue-cured tobacco and $1.50 per pound for burley. These price elections are available to all grower of flue-cured and burley tobacco that insure their 2005 crop above the catastrophic level.

Procedures for other types of tobacco (such as flue-cured) remain unchanged for the 2005 crop year. Producers without a current Quota Tobacco Policy who want insurance on their burley crop have until March 15, 2005, to apply for 2005 coverage and are strongly urged to contact a crop insurance agent as soon as possible. For a list of crop insurance agents in your area, please see the RMA web site at: http://www3.rma.usda.gov/tools/agents/.