(WASHINGTON D.C.) – The USDA’s Risk Management Agency (RMA) on Monday is announcing a sweeping package of updates to its three flagship livestock insurance products — Livestock Risk Protection (LRP), Livestock Gross Margin (LGM) and Dairy Revenue Protection (DRP) — beginning with the 2027 crop year. The changes, approved by the Federal Crop Insurance Corporation Board, expand coverage, modernize eligibility definitions and bring greater consistency across RMA’s livestock portfolio.
For USDA Under Secretary for Farm Production and Conservation Richard Fordyce, the announcement lands at a pivotal moment for the cattle and dairy sectors.
“It comes at a really, really important time, the ramp up of the program,” Fordyce said in an interview. “When we’re seeing, you know, certainly, I think it’s safe to say historic highs in feeder cattle, live cattle markets, the ability to protect that price — or to ensure that if the price goes down, you’ve got coverage — is so important. The value of a producer’s herd or individual animal is so high that it really is important to protect that investment.”
A Program That Has Exploded in Use
Livestock coverage under the federal crop insurance umbrella is a relatively new offering, but adoption has been staggering. Fordyce pointed to the program’s roots in the 2018 Bipartisan Budget Act and the rapid growth that followed.
“That first year in 2018, producers paid premiums of $13 million,” Fordyce said. “In 2025, the producer premium paid was $1.7 billion. So it’s a massive growth in risk management for livestock.”
Uniform Changes Across LRP, LGM and DRP
Several updates apply uniformly across all three programs. RMA is adding subsidy capture language to address off-exchange contracts, updating the definition of beginning farmer or rancher and subsidy percentages to align with the One Big Beautiful Bill Act, permitting concurrent coverage between similar livestock programs, allowing policies that haven’t earned premium for three consecutive years to be cancelled, and revising transfer-of-coverage language.
“These updates expand coverage options, update eligibility definitions and strengthen program consistency across RMA’s livestock portfolio,” says RMA Administrator Pat Swanson. “These enhancements are another way we are putting Farmers First. We want to ensure that livestock and dairy operations across the country have the best tools available to manage risk.”
Fordyce emphasized that the changes flow from two different streams. “Part of this came from Congress. Part of this came from the board through input from the industry,” he said. “Cattle producers, dairy operations — they provided input and said, if you could make these changes, that’s going to make it better and easier for us to participate and offer better assurances from a risk management standpoint.”
Uniform changes across LRP, LGM and DRP include:
- Adding subsidy capture language to address off-exchange contracts.
- Updating the definition of beginning farmer or rancher and subsidy percentages to align with the One Big Beautiful Bill Act.
- Permitting concurrent coverage between similar livestock programs.
- Enabling policies that have not earned premium for three consecutive years to be subject to cancellation.
- Revising transfer of coverage language to clarify when coverage can be transferred.
- Updating general policy language for consistency with other RMA insurance policies.
A Bigger Door for New and Beginning Producers
One of the headline changes — drawn directly from the One Big Beautiful Bill Act — doubles the window during which new and beginning farmers and ranchers can access premium reductions.
“Right now, the new and beginning farmer definition, if you qualify, you basically got a cut in the premium for five years. It’s graduated depending on how many years you’ve been in the program,” Fordyce explained. “The One Big Beautiful Bill allowed for new and beginning farmers to take advantage of that premium reduction for 10 years now.”
He framed the change as a meaningful runway for young producers entering an expensive industry. “New and beginning farmers are probably, you know, economically, financially, probably at risk more than most others. So for this to allow them to participate with lower premiums for 10 years is really important.”
Tailored Updates by Program
The popular Livestock Risk Protection program — which insures against declining market prices at coverage levels from 75% to 100% of expected ending values — sees some of the most substantive changes. RMA is expanding the forage disaster exemption to address extended drought and other natural disasters, increasing the maximum weight threshold for Fed Cattle types, extending Cull Cow coverage to a maximum of 52 weeks, and adding three new feeder cattle types — Unborn Bulls and Heifers Weight 2, Unborn Brahman Weight 2, and Unborn Dairy Weight 2 — in the 6.0 to 9.0 hundredweight range.
“Some of the provisions announced today are really meant to offer more clarity, and align those programs to better fit the situation that livestock producers see in their operations,” Fordyce said.
Livestock Gross Margin, which protects cattle, dairy and swine producers against unexpected drops in gross margin, gets several technical but consequential updates. The maximum insurable weight for LGM Cattle increases to 1,800 pounds. The “target feeder cattle weight” maximum rises from 9 to 12 hundredweight for yearling finishing operations, and “target live cattle weight” maximums move from 15 to 18 hundredweight for yearling finishing and 13 to 16 hundredweight for calf finishing. The “share” definition now requires producers to own calves for at least five months for yearling finishing or eight months for calf finishing.
Dairy Revenue Protection, which guards against revenue declines in milk production on a quarterly basis, receives a single but meaningful tweak: the sales period end date moves to the following calendar day, aligning DRP with the sales period structure used elsewhere in livestock insurance.
“You operate one program this way, you operate one program this other way,” Fordyce said of the rationale. “Any time we can consolidate, make the way we operate these programs the same, it eliminates confusion. It also eliminates the off chance that someone didn’t completely understand how this program was administered and they miss an opportunity.”
Looking Ahead
LRP, LGM and DRP are available to producers in all states and counties. Coverage is sold and delivered exclusively through private crop insurance agents; a full list is available through the RMA Agent Locator at rma.usda.gov.
For Fordyce, the broader takeaway is the value of constant refinement informed by the people who use the programs. “When you look at the average livestock operation — and I don’t even know what average is anymore — there’s significant investment. These risk management tools are in place to protect that investment,” he said. “Risk management is critical in this day and age, probably more so than it’s ever been.”
Contact a crop insurance agent to see how Federal crop insurance can meet the specific needs of your operation. Crop insurance is sold and delivered solely through private crop insurance agents. A list of crop insurance agents is available online at the RMA Agent Locator. Producers can learn more about crop insurance and the modern farm safety net at rma.usda.gov or by contacting their RMA Regional Office. RMA’s Basics for Beginners provides information for those new to crop insurance.
Watch the full conversation with USDA Undersecretary for Farm Production and Conservation Richard Fordyce below:
