FSA updates LIP payment rates for smaller calves
The Agriculture Department’s Farm Service Agency on Wednesday updated its payment rates under the Livestock Indemnity Program for calves weighing less than 250 pounds to value them the same as non-adult cattle weighing between 250 and 399 pounds, and increased payment rates for calves under 400 pounds.
The U.S. Cattlemen’s Association, which had written FSA Administrator Zach Ducheneaux this week about the issue, praised the decision. Lia Bondo, the Washington lobbyist for the U.S. Cattlemen, told The Hagstrom Report in an email, “Administrator Ducheneaux wastes no time in taking action. He’s a pragmatic rancher, first and foremost.”
The Independent Beef Association of North Dakota, an affiliate of the U.S. Cattlemen’s Association, said it had been “instrumental” in urging FSA to re-evaluate the LIP payment rate and normal mortality rate for beef cattle under 250 pounds.
I-BAND explained, “Prior to 2020, there was one weight class for non-adult beef cattle under 400 pounds that provided a fair indemnity for younger calves lost to a natural disaster. Today, the Livestock Indemnity Program has two weight classes for calves under 400 pounds, the lowest being under 250 pounds.
“The April winter storms that rolled through North Dakota one after another left our cattlemen and cattlewomen with extreme losses, most occurring in the under 250 pounds weight class. Each calf they were unable to raise to weaning will reduce their annual income by $1,000 to $1,200. Many ranchers have already paid the expenses to raise those lost calves until weaning. The financial outlook caused by these storms were catastrophic.
“The payment rate according to LIP policy is set at 75% of the fair market value. Previously, the rate for this program for calves under 250 pounds was $175. That puts the estimated average market price at $233. As of July 18, 2022, the payments rates for beef have been updated to use the same price as the 251-to-399 pound livestock. The rate is now set at $474.38 per head for the cattle weighing less than 250 pounds.”
But Sen. John Hoeven, R-N.D., the Senate Agriculture Committee ranking member, and Sen. Kevin Cramer, R-N.D., both said they had been working with USDA on the issue for months.
Hoeven said in a news release that, after hearing producers’ concerns at a roundtable discussion he held earlier this year, he raised the issue with Agriculture Secretary Tom Vilsack and Ducheneaux.
“We appreciate Secretary Vilsack and Administrator Ducheneaux for working with us to update these LIP payment rates, which previously had not reflected ranchers’ true losses,” said Hoeven. “This improved assistance will help ranchers to better recover their operations following the severe weather that hit during calving season this year, and builds upon the assistance we secured under ELRP to address the impacts of last year’s historic drought.”
Cramer said he had urged Ducheneaux in April “to provide accurate relief to eligible livestock owners for deaths under LIP following winter storms in North Dakota.”
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