Fed Cattle
Livestock Risk Protection (LRP)
Livestock Risk Protection-Fed Cattle is one of the two cattle-related commodity types under LRP. this product is federally reinsured and protects against declining market prices. LRP bases its numbers off of the CME Fed Cattle Index. When purchasing coverage, you may select from various coverage levels and periods to match the time the fed cattle will be marketed. This policy has no specific beginning or end date to be purchased and therefore is flexible to each individual’s marketing needs. Updates involving rates, pricing, and ending values are available to customers and producers alike daily.
Eligibility
For the LRP program, Fed cattle qualify as heifers and steers weighing between 1,000 and 1,600 pounds, or dairy cull cows between 800 and 1,500 pounds that will be marketed for slaughter near the end of the insurance period. The annual limit for fed cattle is 25,000 head per producer for each crop year, and you can have a total of 12,000 head per endorsement.
Specifics
For fed cattle LRP policies, specific coverage endorsement options are available for 13, 17, 21, 26, 30, 34, 39, 43, 47, or 52 weeks for heifers and steers, and a 13 week endorsement for dairy cull cows. The fed cattle policy is also currently available in all states. Additionally, in order to receive an indemnity payment, you must provide sales records for the cattle within 60 days
Coverage may be purchased after the price guarantee has been posted to the RMA (Risk Management Agency) website and before 8:25 AM Central Time the following day, with coverage prices ranging from 75 to 100 percent of the expected ending value. After enrolling into the Fed Cattle Policy, coverage starts the same day or when the RMA approves the purchase. This program is built to take some burden away from the producer by protecting them from potential drops in livestock prices. One thing to note is death loss and poor performance is not covered under this policy.
It is important to note, death loss and performance is not covered by this policy. However, if livestock die during the coverage period, you may choose to remove them from the policy if you wish, as long as its reported within 72 hours.