Understanding Critical USDA Livestock Assistance Programs

Sometimes in agriculture, you can seemingly do everything right and still face adversity due to circumstances beyond your control. Variables such as weather, wildlife predation, and disease can cause significant financial strain on any operation. Often, when farmers hear about potential sources of assistance, it prompts an extensive internet search that yields limited results and mounting frustration. Knowing where to turn for assistance can be challenging; however, it does not have to be. In this article, I will break down two important USDA livestock programs that can help mitigate the variables referenced above and help your operation cope with adverse conditions that affect profitability.

The Livestock Forage Disaster Program (LFP) is administered by the USDA Farm Service Agency (FSA). LFP provides compensation to eligible producers in the event of grazing losses sustained by counties experiencing a qualifying drought during the normal grazing season. Payment is generated for a county when any portion of the county experiences a D2 (severe drought) designation for at least four consecutive weeks during the normal grazing season. In this scenario, an eligible producer would be able to receive assistance equal to one monthly payment. If the drought designation lasts for at least seven of the eight consecutive weeks during the normal grazing season, the assistance amount is multiplied to create two monthly payments. Payment amounts increase through the D4 designation, which can be as large as five monthly payments. Current LFP eligible counties in Pennsylvania with a D2 designation include Adams, Bedford, Berks, Bucks, Chester, Cumberland, Delaware, Franklin, Fulton, Lancaster, Lebanon, Lehigh, Montgomery, Somerset, and York.

Eligible livestock for LFP includes alpacas, beef cattle, buffalo/bison, beefalo, dairy cattle, deer, elk, emus, equine, goats, llamas, ostrich, reindeer, sheep, and water buffalo. Livestock must receive a majority of their net energy requirements through grazing forages or legumes to be eligible.  Livestock must have been owned for at least 60 days prior to the beginning date of the drought.  Livestock mitigation resulting from a qualifying drought may also be eligible. Producers must file a timely acreage report for all grazing land with their local Farm Service Agency office. Payments are subject to adjusted gross income provisions. I would encourage producers grazing livestock in any of the 15 counties listed above to contact their local FSA office or visit the USDA Livestock Forage Disaster Program website for additional information including payment rates.

The Livestock Indemnity Program (LIP) is also administered by the USDA Farm Service Agency. LIP provides benefits to eligible livestock owners or contract growers for livestock deaths in excess of normal mortality caused by eligible loss conditions, including eligible adverse weather, eligible disease, and attacks by animals reintroduced into the wild by the federal government or protected by federal law, including wolves and avian predators. LIP also aids eligible livestock owners who must sell livestock due to an injury from an eligible loss condition. Recent policy updates made possible by the Working Families Tax Cuts Act have introduced several key improvements, including expanding eligibility for losses of unborn livestock, allowing producer-specific alternative market values, and increasing payment rates for predation losses. Coverage for losses is calculated at 100% for predation losses and 75% for all other losses.  Producer’s alternative market losses are capped at 145% of the national average market value for eligible losses. It is important to note that as Theileria orientalis continues to spread in Pennsylvania, livestock losses can be mitigated through participation in the LIP Program.

Livestock must be owned on the day the livestock died and/or were injured by the eligible loss condition. Losses must exceed normal mortality as determined by FSA. Eligible livestock for LIP includes cattle, poultry, swine, equine, deer, goats, sheep, alpacas, reindeer, llamas, emus, and ostriches.  For unborn livestock, payments are calculated with normal mortality determined for the adult livestock gestating at the time of loss, multiplied by 85% of the payment rate for the lowest livestock category for the kind, type, and weight of livestock, times the birthing factor, which is defined as 2 for sheep/goats/deer, 12 for swine, and 1 for all other livestock, then multiplied by the producer’s payment share. Note: livestock that are stillborn or aborted from adult females that did not die as a result of an eligible loss condition are ineligible for unborn livestock death loss benefits.  Injured livestock sold at a reduced rate due to a loss condition are potentially eligible for the difference between the price received and the national payment rate for the applicable livestock category. Payments are also subject to adjusted gross income provisions. Producers experiencing livestock death or injury losses are encouraged to visit the USDA Livestock Indemnity Program website for additional information including payment rates.

Although no one looks forward to needing to utilize any disaster assistance program, taking a moment to research how programs such as LFP and LIP could potentially be implemented during your time of need could pay significant dividends in the future. Often overlooked by many new and beginning farmers, disaster preparedness is an important component of an operation's sustainability plan. I would strongly encourage producers to reach out to their local USDA Service Center for more information. The location of your local Service Center can be found on the USDA Service Center Locator website.  While these programs may not make your operation profitable during the event, they can be used to ensure your program can "weather the storm" (or lack thereof, in the case of LFP) and survive until your next production cycle.

This article was previously published in the Lancaster Farming.