06/19/07 A new risk managment tool for livestock producers

Washington Ag June 19, 2007 The Spokane Office of the Risk Management Agency has announced the availability of the Livestock Risk Protection, or LRP program, for all counties in Washington, Oregon and Idaho. Jo Lynne Seufer of RMA says LRP plans of insurance include fed cattle, feeder cattle and swine. Seufer: "LRP only covers the price peril. It does not cover mortality, physical damage, disease, local price deviations but it does cover the change in price peril And the producer has the option to choose what price they want to guarantee." Seufer says LRP is similar to purchasing a put option. Seufer: "But what is more user friendly about the Livestock Risk Protection is that again, it is more user friendly. A producer doesn't need a large, huge amount of value as a put option requires. They can insure one steer, one heifer or one hog." And premiums are subsidized by the USDA. There are limits though on the number of head that can be insured annually. LRP sales for the 2008 crop year begin July 1st. Tomorrow, how to participate in this new risk management program. I'm Bob Hoff.