Livestock Risk Protection (LRP) insures against declining market prices (based on USDA’s Agricultural Market Service). 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.
LRP protects your investment should prices drop before your livestock gets to market while preserving your upside potential.
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.