In the U.S., believe it or not the government often tries to manipulate the agricultural market (supply and therefore prices) by giving economic incentives (subsidies or tax credits) to make farmers not produce certain crops. In some instances, the U.S. government even pay farmers not to plant anything and leave their land unused (this is actually somewhat beneficial because it allows the soil to retain its nutrients and be healthier in the long run).
Other than that, theres the natural side of it. Optimal plant growth will be achieved with optimal rainfall / irrigation. If there is not enough water, not as many plants will grow, and if there is too much water plants will drown and die.
The three biggest ones are: the genetics of the seeds, how much water the land receives, and nitrogen availability in the soil.
In citation 1 below, the upward trend from around 1940 to the present is the result of increased nitrogen (from synthetic fertilizer) and improved breeding, 1940 was around the time when the use of hybrid corn was becoming widespread. The variation from one year to the next is mostly the result of weather (too much rain or not enough).
There are of course many other factors that as also involved, and I don’t consider things like weeds and insect pests which are often controlled using pesticides here in the US, but can drastically reduce yields when left unchecked.
How can we put more nitrogen into the soil to help with crop yields also are farmers protected from small crop yields through insurance?
The main way to get more nitrogen into the soil is by adding fertilizer, either synthetic, or, especially in organic systems, waste from animals and plants which decomposes and releases nitrogen in the soil. The other effective method to get more nitrogen in the soil is to grow plants that form symbiotic relationships with special kinds of bacteria that can turn nitrogen from the atmosphere into forms that plants can use (examples include: soybeans, peanuts and clover). After these nitrogen fixing plants are done growing, the farmer will plow them into his field, where they’ll release the nitrogen they fixed during the growing season into the soil.
Farm insurance is a very complicated system, and I imagine you can find someone who knows more about it to answer that part of your question (I wouldn’t want to make mistakes trying to do it myself).
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