2022 the third-costliest disaster year on record

New AFBF report shows extreme weather caused more than $21 billion in crop losses.

March 8, 2023

3 Min Read
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2022 will go into the record books as the third-costliest year for weather disasters in U.S. history, with an estimated $165 billion in total economic losses. Particularly in the agriculture sector, a new Market Intel report by American Farm Bureau Federation (AFBF) economists shows extreme weather caused more than $21 billion in crop losses.

Texas suffered the most significant hit, with over $6.4 billion in incurred losses primarily made up of $2.9 billion in damages to cotton, $1.7 billion in damages to forage and rangeland and nearly $1 billion in wheat damage. Widespread exceptional drought was the main contributor, but AFBF said some of the losses were also linked to May hailstorms and severe weather in April.

AFBF said the impact to America’s farms and ranches demonstrates the importance of farm bill programs to help rural communities recover from weather-related disasters.

The Market Intel, part of AFBF’s series on disaster losses, analyzes and summarizes total crop loss estimations across all major weather events for 2022, including hurricanes Fiona and Ian, the June 13 derecho that impacted several central U.S. states, and the ongoing drought affecting much of the Western U.S. The Market Intel also analyzes the coverage—and coverage gaps—provided by existing risk management programs, such as crop insurance, as well as ad hoc disaster assistance like the Farm Service Agency’s new Emergency Relief Program (ERP), previously known as the Wildfire and Hurricane Indemnity Program + (WHP+).

“Over $11 billion in losses were covered by existing Risk Management Agency programs as of February 2022,” the report noted. “Over $10 billion in losses were not insured through RMA, existed outside policies’ coverage levels, or did not qualify under an existing risk management program,” which highlights the importance of inclusive protections for growers of all crops in all regions of the nation.

AFBF President Zippy Duvall commented: “It’s not hard to see why programs like crop insurance and disaster coverage are vital to the livelihoods of farmers and ranchers, and the stability of our country as a whole. Even a brief analysis of estimates from last year’s disaster losses proves why a strong farm safety net is a necessity. When you have nature as a business partner, you need a strong support system to help put the pieces back together when the unexpected happens.”

According to the report, the full extent of 2022 damage across agriculture is likely far higher as crop loss estimates do not include infrastructure damage, livestock losses, horticulture crop losses or timber losses associated with the weather events.

Already in 2023, farmers and ranchers are experiencing flooding, freezes and persistent drought conditions. AFBF said the stability of U.S. farms and ranches relies on their ability to be resilient under an array of climate and weather conditions.

“The 2023 farm bill will give lawmakers a chance to fill gaps in existing risk management programs, providing similar risk management opportunities for farmers regardless of what they grow. The sure and timely payments associated with crop insurance and other farm bill programs is often critical for farm-level stability, and so for a safe and secure domestic food supply.”

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