BULLETIN NO.: MGR-96-051

To:       All Reinsured Companies
          All Risk Management Field Offices
          FSA Headquarters, Program Delivery and Field Offices

From:     Kenneth D. Ackerman    
          Acting Administrator

Subject:  1996 Appraisal Deviation for Smut Infected Sugarcane in Texas

BACKGROUND:

Recent outbreaks of stem or culmicolous smut (Ustilago Scitaminea Syd.) have 
been reported in many sugarcane fields in the Texas Lower Rio Grande Valley.   
Hot dry conditions promote spore survival/dispersion and mild overwintering 
conditions for the past four winters have contributed to the smut buildup in 
the area.  This, coupled with persistent drought conditions, has triggered a 
severe outbreak of the disease in many fields.

The disease is spread by smut spores entering the basal buds of the canes, 
germinating, and penetrating the stalk. The disease progresses upward inside 
the cane and eventually reaches the growing point where it is transformed 
into a buggy whip type growth. Easily recognizable at this point, the whip 
is a thinly cased body containing millions of dark brown to black spores 
easily dispersed and spread throughout the field by wind and through 
irrigation water.  Affected plants are stunted, stalks are abnormally thin 
and lateral buds or eyes often germinate and grow giving the whole plant a 
grassy appearance.

The ultimate affect of the fungus is a reduction in the amount of processable 
sugar from infected canes.  The disease is progressive once it becomes 
established in a field as there is no known chemical control for the fungus. 
The most effective control has been the use of resistant varieties.  Although 
the disease has been present in many of the fields since about 1981, the 
disease has had no noticeable effect on yields until this year. Yield 
reductions become noticeable when plant/stool infestation levels throughout 
the field exceed the 10-15 percent range.

Current appraisal methods in the Sugarcane Handbook provide for appraisals 
based on the Primary Shoot and Mature Weight methods but neither method makes 
any allowance for the affect of this disease on potential yields for 
processed sugar. 

Based on processing information obtained from the sugar mill and in 
collaboration with Texas Agricultural Extension Service at Texas A&M 
University, sugarcane appraisals need to be adjusted to reflect the reduction 
in sugarcane tonnage from smut infected acreage.  The reduced tonnage will 
ultimately result in a reduced amount of processable sugar.

ACTION:

For smut infected sugarcane, to be used ONLY in conjunction with the Primary 
Shoot appraisal method, use the following table to adjust the per acre 
appraisal (tons) for the field based on the simple average of the percent 
smut infected canes:

Field Average    Tonnage             Field Average         Tonnage
Percent Smut     Remaining Factor    Percent Smut          Remaining Factor 
Infected Canes                       Infected Canes 
--------------   ------------------  ------------------    ----------------
Less than 20%    Use full appraisal       50%               .30 factor     
20%              .80 factor               55%               .25 factor
25%              .70 factor               60%               .20 factor     
30%              .60 factor               65%               .15 factor
35%              .50 factor               70%               .10 factor     
40%              .40 factor               75%               .05 factor
45%              .35 factor               80% or Greater    Total Loss               

APPLICATION:

1    Use the Primary Shoot appraisal method from the loss adjustment 
     procedure.  Note: Primary Shoots are identified as the first shoot from 
     the plant (cluster, stool, or ratoon).

2    Document, on the appraisal worksheet, the following:

     (a)  From each sample (used for the Primary Shoot appraisal method):

          Select 5 consecutive plants/stools from the same sample.  Count the 
          total number of stalks from the 5 consecutive plants/stools.  Count 
          the number of smut infected stalks from the same plants/stools. 
          Divide the number of smut infected stalks by the total number of 
          stalks, rounding to the nearest whole percent.  The result is the
          percent of smut infected canes in the sample.

     (b)  Calculate a simple average of all samples to determine the Field 
          Average Percent Smut Infected Canes, rounding to the nearest 5 
          percent. 

     (c)  Select the Tonnage Remaining Factor from the table above, using 
         the Field Average Percent Smut Infected Canes from item 2(b).

     (d)  Multiply the tons per acre appraisal determined from the Primary 
          Shoot Method by the Tonnage Remaining Factor.

     (e)  Convert the reduced tons per acre appraisal (item 2(d)) to whole 
          pounds of sugar using the following formula:

          Adjusted Tons Per Acre Appraisal X Percent-of-Sugar Factor (percent 
          of sugar from the County Actuarial Table converted to a 3-place 
          decimal) X 2000 = Potential in pounds of Raw Sugar

     (f)  Document date of this bulletin authorizing the deviation.

3    Insurance providers are reminded that damage caused by smut invokes the 
     plant disease claims procedures outlined in "Other Special Claims 
     Procedure" of the Loss Adjustment Manual.

4    If insurance providers appraise smut-infected acreage and the insured 
     elects to continue to care for the crop, the amount of production to 
     count for such acreage will be the harvested production.  If a 
     reappraisal is required due to additional damage and the crop is mature,
     use the Weight Method appraisal.  The tonnage remaining factor would 
     not apply.

EXAMPLE:  

1    Per Acre Appraisal for the field determined using the Primary Shoot 
     Method = 14 tons

2    (a)  Percent of smut infected canes in each sample.

          Sample No. 1 = 10 smut infected stalks  25 total stalks = 40%
          Sample No. 2 = 29 smut infected stalks  45 total stalks = 64% 
          Sample No. 3 = 39 smut infected stalks  65 total stalks = 60%
          Sample No. 4 = 24 smut infected stalks  80 total stalks = 30%

     (b)  Simple average determined from all samples:

% Smut       Sample #1   Sample #2  Sample #3  Sample #4  Simple Average      
Infected     ---------   ---------  ---------  ---------  --------------
Canes           40%         64%        60%        30%   = 194  4 = 48.5 = 49%
Per Sample
       
     (c)  Simple average of 49%, rounded to nearest 5% = 50% Field Average 
          Percent Smut Infected Canes.  Tonnage Remaining Factor from the 
          table = .30 factor  

     (d)  Reduced appraisal after applying the Tonnage Remaining Factor: 
               14 tons per acre appraisal X .30 = 4.2 tons per acre

     (e)  Converted reduced tons per acre appraisal to whole pounds of sugar 
          equals:  
               4.2 reduced tons per acre X .090 percent-of-sugar 
               factor X 2000 = 756 lbs.

Note:  Throughout this notice the terms cane, stalk, and shoot are used 
       synonymously and the terms plant, cluster, stool, and ratoon are 
       used synonymously.