LGM-Dairy Cattle (LGM-Dairy) provides protection against loss of gross margin (market value of milk minus feed costs) on milk produced from dairy cows.
LGM-Dairy uses the Chicago Mercantile Exchange Group futures prices for corn, soybean meal and class III milk to determine the expected gross margin and the actual gross margin sold. Producer premium subsidy is available for the LGM-Dairy plan of insurance and is determined by the deductible amount chosen by the producer. All administrative and operating subsidies are paid for by the Federal Crop Insurance Corporation.
The indemnity at the end of the 11-month insurance period is the difference, if positive, between the gross margin guarantee and the actual gross margin. The price the producer receives at the local market is not used in these calculations.
To enroll, producers must sign-up on the last business Friday of the month, submitting an application with a target marketing report for the milk and corn and soybean meal equivalents to be insured.
LGM is available to any producer who owns dairy cattle in the 48 contiguous states.
Not all coverage or products may be available in all jurisdictions. The description of coverage in these pages is for informational purposes only. Actual coverage will vary based on the terms and conditions of the policy issued. The information described herein does not amend, or otherwise affect, the terms and conditions of any insurance policy issued by ProAg or any of its subsidiaries.