Livestock Risk Protection (LRP): A Practical Guide for Cattle Producers in the Carolinas
Raising cattle is a constant balance between what you can control and what you have to endure. You manage genetics, pastures, feed, water, fencing, and herd health. But one thing you can’t manage is the national cattle market.
When prices fall at the wrong time, all the hard work that went into raising a calf can evaporate in a single bad week. And unlike rain or insects or wildlife pressure, there’s no indemnity check waiting because the market dipped. That’s where Livestock Risk Protection (LRP) comes in.
What LRP Actually Does
At its core, LRP is price insurance. It guarantees that if the national market price for feeder cattle, fed cattle, or swine falls below the insured price on the day you intend to sell, you get paid the difference.
Think of it as the revenue-protection version of cattle insurance. LRP aims to ensure a bad price swing doesn’t wipe out your margin.
How the Program Works
When you see favorable national market prices for cattle or swine, you can lock that price in with an LRP endorsement that ends around the time that you expect to market your livestock. You can insure any amount of your cattle/swine and are not required to cover your entire herd.
When the endorsement matures, USDA compares the actual national market price (not the price you sell for) on that end date to your guaranteed price. If the market ends lower than your coverage, you receive an indemnity for the difference.
No adjusters, no photos, no carcass weights. Just a simple comparison of the two prices.
LRP is designed to be practical, accessible, and easy to use, especially for operations that don’t have the time or the appetite to trade in the futures market.
What LRP Does Not Do
LRP does not:
Guarantee a specific profit
Protect against death loss, disease, drought, or input costs
Pay based on your actual sale price
Protect against basis risk (your sale price vs. national prices)
It protects national market price risk, not local market.
Final Thoughts: A Tool, Not a Gamble
LRP won’t make you rich and won't solve every production problem. But it will help ensure that the months or years you’ve invested in raising those cattle don’t get erased by a bad week in the market.
For many operations in the Carolinas, LRP is a simple, affordable way to put a floor under your income.
If you think LRP might fit into your risk-management plan, we’d be glad to walk you through the options, pricing, and timing for your operation. Whether you run 5 cows or 500, we’ll help you protect the work that keeps your farm moving forward.
Foothills Crop Insurance is a family owned insurance agency with over 85 years of combined experience. We’re experts in tailoring policies to fit grower's operation and budget. Contact us today, and let our family take care of you like you’re one of us! 800-660-8674