FARM SERVICE AGENCY UPDATES LIVESTOCK INDEMNITY PROGRAM PAYMENTS

An affiliate update from the Independent Beef Association of North Dakota

(JULY 20, 2022) – Recently, I-BAND was instrumental in urging the Farm Service Agency (FSA), State and National offices, to re-evaluate the Livestock Indemnity Program (LIP) payment rate and normal mortality rate for beef cattle that are under 250 lbs. Prior to 2020, there was one weight class for non-adult beef cattle under 400lbs that provided a fair indemnity for younger calves lost to a natural disaster. Today, the Livestock Indemnity Program (LIP) has two weight classes for calves under 400 lbs., the lowest being under 250 lbs.

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 lbs. weight class. Each calf they were unable to raise to weaning will reduce their annual income by $1000-$1200. 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 lbs. 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 lb livestock. The rate is now set at $474.38 per head for the cattle weighing less than 250 lbs.
LIP payments previously paid for the livestock types of beef, beefalo, buffalo/bison, and dairy under 250 pounds and 250 to 399 pounds will be recalculated to pay the updated amount once the updated amounts are loaded into the LIP software. If no update to the application was made, no further action is required.

Information gathered for this release were taken from an I-BAND committee and FSA (www.fsa.usda.gov/Internet/FSA_Notice/lip_4.pdf).

USCA also sent a letter to USDA Farm Service Agency Administrator Zach Ducheneaux requesting these changes.