By Shannon Sand
For livestock producers, managing risk often means using more than one tool. Three insurance programs Pasture, Rangeland, and Forage (PRF); Annual Forage (AF); and Livestock Risk Protection (LRP) can be good options to complement each other to protect both feed supply and livestock value.
PRF insurance helps offset the financial impact of below-average rainfall during the growing season. It’s based on a rainfall index, not actual forage yield, but it can provide timely payments when drought limits grazing potential.
Annual Forage insurance covers forage crops planted annually for feed or grazing, such as small grains or cover crops. It offers protection against precipitation shortfalls during specific growing seasons, making it especially useful for diversified or integrated systems.
Livestock Risk Protection provides price protection for cattle, and swine. It works much like a put option allowing producers to set a price floor for their livestock while still benefiting if markets improve.
Used together, these tools create a more complete risk management plan: PRF and AF help stabilize feed resources, while LRP protects market value. The goal isn’t to eliminate risk entirely but to manage it in a way that improves cash flow and business stability through variable weather and market cycles.
Producers can work with an insurance agent familiar with RMA programs to find the right mix for their operation and budget.