Updates in Risk Management Tools for Livestock Producers
Livestock producers may have new tools available to them thanks to recent adjustments made to USDA's Risk Management programs. Feeder cattle operators may find some new options. USDA Undersecretary for Farm Production and Conservation Bill Northey reports that the government agency has adjusted some programs specific to livestock producers' needs.
Northey points out that there are crop insurance tools relevant to livestock producers, which some people be unaware of. Livestock Risk Protection is a specifically designed insurance plan to protect producers from market price declines.
Livestock Risk Protection is typically available for fed cattle, feeder cattle, swine, and lamb producers. The Livestock Risk Protection Program is commonly used by feeder cattle producers but is accessible by other species. With a one-time coverage application's acceptance, producers may receive an indemnity payment for the difference between the policy's coverage price and the actual ending value.
In a recent USDA-hosted webinar on livestock risk management, Northey acknowledged recent changes in the programs in premium and payment expectations.
Northey says traditionally, feeder cattle producers have found those programs very useful. But he says there are additional recent changes that benefit feeder cattle producers. The Livestock Gross Margins tool – a tool that he reports is very lightly used but designed to protect a margin between feed and gross revenue has several updates that currently may help feeder cattle operators.