Common Ground Blog

Find trends, outlooks and more on financing rural America from Frontier Farm Credit.

More Content

A Different Way To Manage Livestock Risk

Managing financial risk is perhaps one of the most critical parts of being a successful livestock producer, and 2023 is challenging that premise for both cattle and hog producers. True, these challenges are coming in different ways.   

An alternative way of managing risk is to use Livestock Risk Protection (LRP) and Livestock Gross Margin (LGM) insurance products.

LRP is a federally subsidized resource that allows producers to establish cash price floors on the exact amount of livestock that they own. It protects downside risk and leaves all the upside potential without margin calls or upfront premiums.  

LGM can help producers remain whole when commodity and input prices are working against each other. This is a subsidized product that insures against live cattle and lean hog market declines, as well as increases in corn prices, soybean meal or feeder cattle prices. It works to protect the producer’s margin.   

There are a couple of changes to the products that begin on July 1, 2023, which is the start of the 2024 LRP and LGM crop years.

  • The end of LRP and LGM sales will now close at 8:25 a.m. CT, vs the current 9 a.m. CT.
  • LRP Fed Cattle settlement will be moving to “Over 80% Choice.”

Frontier Farm Credit has dedicated teammates that hold expertise in livestock insurance products. Our team of experts can help with unbiased, financially driven risk management decisions. Here are some other important things to keep in mind when implementing LRP and LGM:  

  • The Frontier Farm Credit cooperative model has kept our focus on customer success. Your success is our success.
  • Frontier Farm Credit has a strong understanding of a producer’s financial position and cash needs.
  • We have top tier knowledge of livestock insurance products and commodity markets.
  • The Livestock Insurance Analyzer tool that we provide our livestock insurance customers was developed by Dr. Marin Bozic, the leader of the Livestock Risk Protection and Livestock Gross Margin programs.

To learn more, visit our Livestock Insurance page.

COMMENTS

Load more comments
Your comment has been received and is being reviewed.
avatar

Comments are moderated and reviewed before they are posted on the site. View our terms of use.

YOU MIGHT BE
INTERESTED IN

Jun 12, 2019 | Crop Insurance

Producers: Control What You Can Control

For those adversely impacted by weather, that means making the right financial decision for your operation during this late planting period. For all producers, it means keeping marketing top of mind to maximize profitability.

Dec 12, 2017 | Crop Insurance

Knowing Your Cost of Production Can Lead to Sound Management Decisions

We introduce you to “Joe Farmer” to illustrate the power of knowing your production cost.

Feb 22, 2024 | The Business of Agriculture

Why Every Producer Needs to Take a Fresh Look at ARC and PLC in 2024

Discover which economic and crop insurance changes need to be factored into 2024 risk management plans ahead of March 15.

Ready to Talk?

Contact us if you have questions or need more information. Fill out the form, or connect with your local office using the Office Locator.

Frontier Farm Credit serves farmers, ranchers, agribusinesses and rural residents in eastern Kansas. For inquiries outside this geography, use the Farm Credit Association Locator  to contact your local office.