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August and September have been dry and Rockbridge finds itself in the grips of a drought. As much as we may try to plan ahead and have reserves on hand to get past dry weather, most livestock farmers are finding themselves in a pinch right now for hay and feed resources to provide their animals because they normally do not have to dip into these resources until much later in the fall or even until winter.
There is a crop insurance product that can provide timely cash payments when the weather is dry which can significantly enhance a farm’s protection from the risk of drought. Pasture, Rage, and Forage Crop Insurance, called PRF Insurance for short, is a private industry drought insurance product available through most crop insurance providers. An analysis of how these policies would have performed in Rockbridge over the past 10 years reveals a low-cost policy would have cost around $3.25 per acre annually but would have yielded an average annual payout of $5.60 per acre. A similar analysis of a higher cost policy that provides a higher level of drought protection would have cost $14 per acre annually but would have yielded an average annual payout of around $25 per acre. The payments come when the weather is dry, generally 90-days after the onset of dry conditions. The better the coverage that is purchased, the higher the annual premium cost but the larger the benefit when the weather turns dry.
Payout to the farmer is determined by the locality’s rainfall index determined through weather analysis by the National Climatic Data Center specific to the locality. PRF insurance payouts to farmers are not dependent on a government drought declaration or any designation on the National Drought Monitor map. PRF pasture and hay meadow insurance is tailored to detect local dry weather events and provide timely cash payments when pasture and hay supplies are likely to be short.
PRF pasture and hay drought insurance for 2024 must be purchased by Dec. 1 of this year (2023) but the premium payment is not due until September of 2024. Now is the time to engage with a crop insurance provider and begin using this valuable risk management tool and enhance your farm’s protection from drought.
PRF crop insurance is a private industry product and must be purchased through a crop insurance provider. Each time a crop insurance company sells a PRF policy, they receive an additional payment from the federal government which keeps premiums low. Federal support of crop insurance benefits is more efficient for the tax payer because it provides timely risk protection for the farmer while not demanding legislative action and USDA staff time to administer. For a free analysis of how PRF drought insurance may help your farm, contact Tom Stanley through the Rockbridge Extension office or by e-mail to stanleyt@ vt.edu.
Update On
Virginia
Fence Law
Rockbridge Farm Bureau Federation and Virginia Cooperative Extension are sponsoring a seminar next week on Virginia Fence Law. Attorney Jennifer Friedel, who teaches agricultural law and real estate law at VA Tech’s Department of Agricultural and Applied Economics, will lead the seminar starting at 7 p.m. on Wednesday, Nov. 1, in the Appomattox Mezzanine at the Virginia Horse Center. The event is free and open to the public. Those who wish to attend this informative seminar should call the Rockbridge Farm Bureau office at (540) 463-3603 so we can plan for seating.
