September 29, 1998



INFORMATIONAL MEMORANDUM: R&D-98-049

TO:        All Reinsured Companies
           All Risk Management Agency Field Offices

FROM:      Tim B. Witt         /s/ Tim B. Witt
           Deputy Administrator

SUBJECT:   Loss Adjustment Advisory for Green Damage Soybeans 

BACKGROUND:  

The dry summer conditions across parts of the country have resulted in soybeans defoliating
prematurely, thus causing some soybeans to contain "green damage" and questions as to whether 
the affected soybeans are eligible for quality adjustment.   

In accordance with the Coarse Grains Crop Provisions, to qualify for quality adjustment for
kernel damage in soybeans, the kernel damage must be determined by grain graders licensed
under the United States Grain Standards Act (USGSA) or under the United States Warehouse
Act (USWA).  All samples used for quality adjustment purposes must be obtained by the
insurance provider or by a disinterested third party approved by the insurance provider.  Loss
adjusters are to verify that grading has been completed by a licensed grader authorized under the
USGSA or USWA.  Kernel damage determined by a grader who is not licensed under the
USGSA or USWA must not be used for quality adjustment purposes.  

ACTION:

Green damage determined by a grader licensed under the USGSA or USWA is kernel damage for
quality adjustment purposes.  Green damage can only be determined from a cross sectional
analysis of a representative soybean sample.  Soybeans having a green seedcoat may not have
green damage and, conversely, soybeans having a yellow seed coat may have green damage. 
Green seedcoats, in and of themselves, are not eligible for quality adjustment.  

Only quality adjustment discounts (or reduction in value (RIV), if applicable) as outlined in the
Special Provisions are allowed in establishing the production to count.  If the green damage is
listed separately from kernel damage on the settlement sheet, the loss adjuster must ensure that
the discount for green damage has not also been included in the discount for kernel damage, thus
resulting in discounts for the green damage twice. 

DISPOSAL: 

This Informational Memorandum is for the purpose of transmitting information and the
expiration date is December 31, 1998.  






                                 
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Tim Oyler   _________________________

Esther Potts  _______________________

Janalee McGarry _____________________

Dave Wright      __________________________

Tim Hoffmann    __________________________

Janice Nuckolls  __________________________