An important fall deadline is approaching for cow/calf and stocker cattle producers. Nov. 15 is the deadline to purchase or change coverage of Pasture, Rangeland, Forage insurance.
Matthew A. Diersen, Agricultural Economist at South Dakota State University wrote that PRF insurance is available using either a Rainfall Index in many Plains states, eastern states or in California or a Vegetation Index in many western states. It is not available nationwide. In-the-know producers will be visiting this option to mitigate risk to their costs.
According to the 2012 Census of Agriculture, there were 914.5 million acres of US farmland. Of these, 415.3 million were in permanent pasture, 28.0 million were in woodland pasture and 12.8 million in other pasture. In addition, there were 55.8 million acres of harvested forage.
However, only 48.3 million acres were insured using PRF, although covered acres have increased slightly in the past two years. Many landowners use the Noninsured Disaster Assistance Program on forage, or specific forage products, like Forage Production insurance on alfalfa. Returning to the mix from the Farm Bill is the Livestock Forage Disaster Program or LFP.
PRF, like insurance on other major crops, contains a subsidized premium so the various PRF products have consistently paid out more than producers have paid in premiums. The presence of the subsidy suggests any eligible landowner would benefit from some coverage, regardless of how it is allocated.
But PRF is known for complicated intervals and a productivity level that is selected when the coverage is purchased. In South Dakota, the most common coverage level is 90%, which does not have the highest subsidy level. NAP and LFP are based on county losses and could have long delays between losses and payments.
There are minimal costs for NAP and LFP, but growers have to pay subsidized premiums for PRF and other insurance.
CONSUMERS LIKE PORK BETTER
A semi-annual Pork Checkoff survey found consumers are eating more pork and enjoying it more. The survey found a statistically significant increase in the number of consumers who said pork provided an enjoyable eating experience.
To back up the survey’s results, the Pork Checkoff’s release also reported USDA data through May 2014 showing year-to-date per-capita pork expenditures grew by 7.5%.
The Checkoff study also asked pork eaters, “Other than price, what most influences your meat-purchasing decisions?” The top three drivers were quality (63%), appearance (50%) and convenience (32%).
CASH CATTLE MARKETS TRADE HIGHER
Cash cattle markets began trading Thursday with activity in Kansas reported at $164 per cwt on a live basis. Traders in Texas were said to be declining such bids as they hold to $167 asking prices.
Sharp losses in futures Thursday may prompt packer buyers to stick to their bids, especially since they are thought to be losing money on each animal slaughtered. The Oct live cattle futures contract settled Thursday at $164.00, down $2.10, but it has recovered slightly in overnight trading.
Thursday’s steep selloff notwithstanding, live cattle futures have risen to new heights over the last two weeks, with Oct setting a new contract high on Thursday before reversing and closing lower. News of better cash trades could reignite futures to regain some of Thursday’s losses.
Wholesale beef prices Thursday continued to move higher. The USDA’s choice cutout was $247.06 per cwt, up $0.51 for the day, and the select cutout was $234.85, up $0.37. For the week, choice is up $8.61 and select is up $7.52.