Cattle producers should consider using livestock risk protection insurance to protect themselves against volatility in the calf market, according to Matthew Dierson, extension business specialist at South Dakota State University.
“LRP for calves works well for cattle producers because a specific number of head can be insured,” Dierson said. “In addition, there is a fixed basis adjustment for calves that offers better protection than when using futures or options contracts.”
As of mid-April, South Dakota producers had insured 31,821 head of feeder cattle through the fiscal year that ends in June. That compares to the nationwide total of 106,370 head insured.
“South Dakota has more insured than any other state — a position held on feeder cattle annually since fiscal year 2008,” Dierson said.