PRICE INSURANCE POLICIES AVAILABLE FOR FED AND FEEDER CATTLE

James Callan (202) 720-6200

WASHINGTON, Apr 28, 2003 - USDA's Risk Management Agency (RMA) has announced two pilot programs that will extend insurance protection to fed and feeder cattle in various pilot States. These are part of Agriculture Secretary Ann Veneman's Risk Management Initiative to expand crop insurance coverage to other sectors, including livestock.

Both programs offer coverage prices based on expected cash prices at the policy end date, with coverage levels ranging between 70 and 95 percent of the expected ending value. The Federal Crop Insurance Corporation (FCIC) will subsidize 13 percent of the producer's gross premium under both programs.

The Livestock Risk Protection (LRP)-Fed Cattle Insurance Program will be available in Illinois, Iowa, and Nebraska, and offers producers a user-friendly risk management tool that protects against price decreases. The term "fed cattle" refers to those that will be marketed for slaughter at the end of the insurance period and includes cattle expected to grade select or better with a yield grade of 1-3.

The insurance period for LRP-Fed Cattle policies will be in approximately 30-day increments between 13 to 52 weeks. For example, the producer may elect insurance periods of 150, 180, or 210 days depending on their operations. The maximum number of fed cattle that may be insured in any one year is 4,000 head.

The Livestock Risk Protection (LRP)-Feeder Cattle Insurance Program will be available in Colorado, Iowa, Kansas, Nebraska, Nevada, Oklahoma, South Dakota, Texas, Utah, and Wyoming. LRP-Feeder Cattle is also designed to insure feeder cattle inventory against decreases in price. "Feeder cattle" refers to steers that will weigh 650-900 pounds at the end of the insurance period. Feeder cattle that are predominantly dairy or Brahma breeds are not eligible for insurance.

Like LRP-Fed Cattle, the insurance period will be in approximately 30-day increments from 22 to 52 weeks. Sales will begin June 9. The maximum number of feeder cattle that may be insured in any one year is 2,000 head.

Producers in States where the two pilot programs are available should contact a crop insurance agent for more information about their insurance options. A listing of crop insurance agents is available at local Farm Service Agency offices or at http://www3.rma.usda.gov/apps/agentslpi/.