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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” →