For Missouri livestock producers, managing market volatility is one of the biggest challenges to profitability. That’s why Livestock Risk Protection (LRP) insurance is the smartest farm risk management tool available. LRP allows you to proactively secure a price floor for your future cattle and hog sales, guaranteeing protection against unexpected market declines before your animals go to market. Jim Hardecke, your local Farm Risk Advisor, specializes in helping producers tailor this critical coverage to their operation, ensuring you maximize your income potential while minimizing exposure to the unpredictable swings of the commodity market.
LRP is designed to insure against declining market prices. You may choose from a variety of coverage levels and insurance periods that match the time your feeder cattle would normally be marketed (ownership may be retained).
You may choose coverage prices ranging from 70 to 100 percent of the expected ending value. At the end of the insurance period, if the actual ending value is below the coverage price, you will be paid an indemnity for the difference between the coverage price and actual ending value.
Actual ending values are based on weighted average prices, from the Chicago Mercantile Exchange Group Feeder Cattle Index. Actual ending values are posted on RMA’s website at the end of the insurance period.
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The annual limit for LRP-Feeder Cattle is 12,000 head per producer per year (July 1 to June 30). The length of insurance coverage available for each specific coverage endorsement is 13, 17, 21, 26, 30, 34, 39, 43, 47, or 52 weeks.
Coverage is Available For:
Unborn Bulls & Heifers 100 to 599 LBS
Steer Weight 1 100 to 599 LBS
Heifer Weight 1 100 to 599 LBS
Steer Weight 2 600 to 1000 LBS
Heifer Weight 2 600 to 1000 LBS
Fed Cattle 1000 to 1600 LBS
Coverage prices are based off of CME Feeder Cattle Futures. This is the price adjustment factors used to get coverage prices.
· CAN INSURE 1 TO 12000 HEAD / NO MINIMUM #
· PREMIUM DUE AT END OF CONTRACT
· FLOOR PRICE WITH UNLIMITED UPSIDE
· GAURANTEE CASH FLOW MINIMUM
· PREMIUMS ARE SUBSIDIZED (MAKING IT LESS EXPENSIVE)
· MUST PROVIDE SALE TICKETS WITH SEX AND WEIGHT
LISTED
· CAN KEEP AFTER END DATE MUST PROVIDE PROOF OF
OWENERSHIP FROM A DISINTERESTED THIRD PARTY
· CAN SELL 60 DAYS PRIOR TO END DATE OR 30 DAYS AFTER
· IN CASE OF DEATH LOSS PROVIDE NOTIFICATOIN WITHIN
72 HOURS
· SALES RECORDS MUST BE RETAINED FOR THREE YEARS
