Dairy farmers have a new tool to help ease the risks associated with capturing record high beef cattle prices. A recently introduced insurance option allows farmers to set a floor price for their beef-on-dairy calves and cull cows. Effective July 1, USDA made those animals from dairy farms eligible for its Livestock Risk Protection program, aimed at protecting producers against volatility in the cattle market.
The Center for Dairy Excellence hosted Kathleen Wolfley and Bryce Windecker of Ever.Ag on Sept. 19 to explain the program that only a few years ago may have been of little interest to dairy producers. “The dairy markets and the cattle markets are becoming a lot more entwined,” Wolfley said.
With a historically small national beef herd caused by droughts in the West, higher than usual numbers of heifers going to slaughter, and demand for beef at an all-time high, cattle prices have been breaking records. And more recently, the Mexican border being closed to feeder imports because of screwworm concerns have added to market dynamics. The herd is expected to rebuild, but it will take time, Wolfley said. To help capitalize on demand in the meantime, cattle are being fed longer.
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