Use of Livestock Risk Protection Insurance for Cattle Continues to Grow

Jay Parsons

No 413324, Cornhusker Economics from University of Nebraska-Lincoln, Department of Agricultural Economics

Abstract: When used as a regular part of a market risk management plan, livestock risk protection (LRP) insurance can help protect profits in years where markets turn for the worse. The recent changes to the program have made LRP insurance more appealing to cattle producers and sales of LRP have subsequently increased dramatically. Strong price increases may make LRP unnecessary, but it is difficult to predict when the price increases will end. LRP insurance is a safety net, reducing downside price risk by providing a floor on national price expectations while also allowing producers to take advantage of higher national prices if they occur.

Keywords: Risk; and; Uncertainty (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:ags:nbaece:413324

DOI: 10.22004/ag.econ.413324

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