Livestock Risk Protection (LRP) is similar to a put option, allowing producers to establish a floor price for protection while leaving upside price potential open. Unlike market contracts and options, LRP does not require a margin account or broker, it is closer to the actual ending value of the livestock and is based on cash market index prices rather than the futures market. This federally-sponsored program typically costs less than other options, is often perceived more favorably by lenders, and may provide additional benefits in terms of lending rates or loan availability.
Livestock Gross Margin (LGM) provides protection against the loss of gross or finishing margins caused by a drop in animal prices or increase in feed prices. However, LGM does not insure against death loss or any other loss or damage to the producer’s animals. The policy covers the difference between the gross margin guarantee and the actual gross margin at the end of the insurance period. Futures prices are used to determine the expected gross margin and the actual gross margin. The price the producer receives at the local market is not used in these calculations.
Dairy Revenue Protection (Dairy-RP) is a risk management tool that protects dairy farmers against quarterly revenue losses caused by declines in the value of milk or milk components, or unexpected declines in milk production. This is an area-based revenue insurance product backed by the Federal Crop Insurance Corporation and is indexed using the state-level milk prices. The Dairy-RP policy provides insurance for the difference between the final revenue guarantee and actual milk revenue, times your actual share and protection factor. This loss needs to be caused by natural occurrences in market prices and yields in your state-level or pooled production region. This policy does not insure against the death or other loss or destruction of your dairy cattle.
Let your experienced and trusted ProAg agent help you today with determining what ranching products are appropriate for your risk management needs.
Livestock Risk Protection (LRP)
LRP protects your investment should prices drop before your livestock gets to market while preserving your upside potential.
Livestock Gross Margin (LGM)
LGM protects against the loss of gross margin (market value minus feed costs).
Dairy Revenue Protection (Dairy-RP)
Dairy-RP protects against unexpected declines in quarterly milk sales.
Pasture, Rangeland, Forage (PRF)
The Pasture, Rangeland, Forage (PRF) Pilot Insurance Program is designed to provide insurance coverage on your pasture, rangeland or forage acres. PRF is an area-based plan of insurance that uses a rainfall index to determine losses and trigger indemnities.
Annual Forage Pilot
The Annual Forage pilot program provides coverage to acreage that is planted each year and used as feed and fodder by livestock. This pilot program utilizes the Rainfall Index to correlate to this annually planted acreage. The Annual Forage pilot program is only available in a select number of states and counties.
The Apiculture Pilot Insurance Program provides a safety net for a beekeepers’ primary income sources – honey, pollen collection, wax and breeding stock. The Apiculture Rainfall Index uses the same basic provisions as the Pasture, Rangeland, Forage pilot program.
Providing insurance solutions for today’s complex farming and ranching operations. To learn more about how ProAg can help you deliver timely and relevant risk management solutions for your operation, contact your local, trusted ProAg agent for more information. Come experience the ProAg difference today.