The new higher subsidies for the Supplemental Coverage Option (SCO) and Enhanced Coverage Option (ECO) have generated significant interest among farmers. We recently released the Insurance Evaluator to help farmers make decisions concerning the use of SCO and ECO. Today’s article addresses three common questions that we have received relative to ECO and SCO.

Brazil’s rise as a dominant force in global soybean markets has become a central concern for U.S. producers, with 44% indicating in January they were “very concerned” about the competitiveness of U.S. soybean exports relative to Brazil. Since surpassing the U.S. as the world’s largest soybean producer in 2018, Brazil has continued to expand its presence in global export markets. This article compares the U.S. and Brazilian soybean sectors using farm-level production cost data from 2020 to 2024.

Over the last ten years, when we look at the costs of producing corn versus soybeans, it has been more profitable economically to produce soybeans than corn, except for 2021 and 2022. This explains the general downward trend in the percentage of corn acres in crop rotations in Illinois. Over the last 30 years, we have seen a shift to more corn acres until the 2007 to 2012 time period and since that period, the percentage of acres in the crop rotation planted to corn has decreased until about 2020.

Higher subsidy rates for SCO and ECO in 2026 increase the attractiveness of their usage and the potential for replacing some RP coverage with county-level coverage. However, switching from farm-level to county-based coverage introduces basis risk because farm losses do not precisely mimic county losses. In regions where the basis risk is low, such as in Illinois, use of SCO and ECO with lower RP coverage levels can provide improved risk benefits at similar or lower premium cost to the farmer.

Recent trends in the operational efficiency of the U.S. ethanol industry are analyzed in this article. The picture that emerges from the analysis is one of tradeoffs in operational efficiency of dry mill ethanol plants, with more ethanol and corn oil production coming at the expense of less DDGS. The picture that emerges from the analysis is one of tradeoffs in operational efficiency of dry mill ethanol plants, with more ethanol and corn oil production coming at the expense of less DDGS.

Significantly reduced farmer-paid premiums for Supplemental and Enhanced Coverage Option (SCO and ECO) policies suggest that farmers should consider using these products in their 2026 crop insurance portfolios. Adding SCO and ECO to higher coverage level farm-level plans such as Revenue Protection (RP) will increase expect returns and reduce risk, while also increasing total premium costs. Expected returns can be increased more by reducing RP’s coverage level while still using ECO and SCO.

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