As trade uncertainties loom, economists at Commodity Classic said producers should evaluate their crop insurance options and consider additions, such as the Enhanced Coverage Option (ECO). Export demand remains a key concern. Economists with the American Soybean Association (ASA) and National Corn Growers Association (NCGA) stressed the importance of using crop insurance to manage risk.

ASA President Caleb Ragland said tariffs are not to be taken lightly and will hurt family businesses financially.

Producers do not want to lose any more commodity demand. NCGA Chief Economist Krista Swanson said commodity profit projections are already in negative territory. Last year Mexico purchased over 40% of U.S. corn. Canada is the fifth largest market for corn and China is the eighth. Tariffs and retaliation could drive the price down even further than it already is. Stressing the need to bolster domestic demand, NCGA has been pressing Congress on a bill for year-round E15 nationwide.

ASA Chief Economist Scott Gerlt said a continued U.S. tariff dispute will benefit Brazil, which has hundreds of millions of pastureland that could potentially become cropland.

The U.S. crush capacity is expanding, which does provide a few options. However, China accounted for 52% of U.S. soybean exports last year. Mexico purchased 10% of U.S. whole bean exports and 14% of exported soymeal. Canada purchased approximately 10% of U.S. soymeal.

Both economists urge producers to examine their crop insurance options to protect them if prices drop. The insurance price for corn is $4.70 per bushel this year and the soybean price is $10.54 per bushel. Gerly said that the risk for soybeans is mitigated because you know you have $10.54 locked in.

Producers also need to consider Agricultural Risk Coverage/Price Loss Coverage (ARC/PLC).

Read more on how crop insurance may help in the face of trade tariffs here.