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Forage Risk Management and PRF Insurance

Posted on by Sandy Johnson

Jenny Ifft, Agricultural Policy Extension Specialist

Pasture, Rangeland, and Forage (PRF) insurance is a tool for managing rainfall or drought risk. While individual producer experience varies, PRF has made substantial payouts during drought years. In 2023, producers paid an average premium of $5.11 per acre and received an average payout of $10.06 per acre. The deadline to sign up for PRF insurance for the 2025 calendar year with a crop insurance agent is December 1, 2024. Some producers may be concerned about the degree to which PRF will cover actual forage losses on their operation. This article summarizes these concerns and two approaches to considering them.   Continue reading “Forage Risk Management and PRF Insurance” →

Annual Forage Insurance: New Policy Options and 2022 Performance

Posted on by Sandy Johnson

What is Annual Forage Insurance?

Annual Forage (AF) insurance is a rainfall index product for annual crops produced for forage.[1] AF insures against reduced forage yield due to less precipitation than normal. When rainfall falls below a set amount, a payout or indemnity is made. Precipitation (rainfall) is measured locally, in an approximately 14×16 mile area called a “grid”. A producer selects the months (intervals), weight (importance) of months, and % precipitation (coverage level) they want to insure for. Continue reading “Annual Forage Insurance: New Policy Options and 2022 Performance” →

Value of Forage Insurance during Drought

Posted on by Angie Denton

 By Jennifer Ifft, agricultural policy extension specialist

On October 18, 2022, nearly two-thirds of all Kansas counties were reported as experiencing extreme or exceptional drought. Cattle producers can take many actions to mitigate the impact of drought, including purchasing forage insurance, or Pasture, Rainfall, Forage (PRF) insurance. The deadline to purchase PRF for 2023 is December 1, 2022, but the premium would not be billed until September 23, 2023. In this article, we discuss the what PRF is and report PRF payouts to-date by drought status for all 105 Kansas counties. In 2022, nearly 2.9 million acres were enrolled in PRF in Kansas; USDA reported 15.6 million acres of pastureland in Kansas in 2017. PRF premiums for 2022 totaled about $14 million and PRF has already paid out over $20 million in indemnities.

Continue reading “Value of Forage Insurance during Drought” →

Safety Net Program Payments and Drought Costs

Posted on by Sandy Johnson

Jennifer Ifft, Robin Reid, Cordon Rowley, Agricultural Economics

With ongoing severe drought in many parts of Kansas, cattle producers continue to face tough decisions: how to feed their cattle and whether to increase culling rates. Several safety net programs are available through Federal insurance products (Annual Forage, Pasture Rangeland and Forage–PRF, others) and the Farm Service Agency (Emergency Assistance for Livestock, Honey Bees, and Farm-raised Fish–ELAP, Livestock Forage Disaster Program–LFP, others). The purpose of these safety net programs is to make payments that would ultimately make these decisions a little less painful: money to help keep feeding your cattle or to save for eventual restocking or a combination of the two. The objective of this article is to provide an example of the magnitude of safety net payments and the financial tradeoffs that cattle producers are currently facing.  Continue reading “Safety Net Program Payments and Drought Costs” →