Livestock Gross Margin (LGM) is a federally reinsured livestock product that provides protection against the loss of gross margin.
The RMA monitors capacity levels, and when the funding limit has been reached, sales for this product will cease.
New for RY 2025
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LGM Swine offers will not be available on dates that USDA releases the Hogs and Pigs report
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LGM Dairy Cattle offers will not be available on dates that USDA releases the Milk Production, Cold Storage, and Dairy Products report
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LGM Cattle offers will not be available on dates that USDA releases the Cattle on Feed report
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For LGM Cattle & Swine: Loss payments will be prorated if the actual marketings fall below 85%
- Definition of Cumulative Target Marketing’s for each month insured has been added to LGM Cattle & Swine.
- For LGM Cattle: The mix of target cattle marketings and target feed rations and feeder cattle weights allow a producer to select feed rations and production levels that best reflect their actual production. This effectively insures the producer gross margin, which is the difference between the gross margin guarantee and the actual gross margin at the end of the 11-month insurance period.
- To receive an indemnity, for LGM Cattle & Swine; marketing records must be dated no more than 15 days prior to the start of the Target Marketing month and no later than 15 days after the end of the Target Marketing month.
Recent Updates
- Sales close for LGM Cattle & Swine is now at 8:25 AM CST
- Target Marketing Reports are now called Specific Coverage Endorsements (SCE)
- LGM Dairy Cattle must provide proof of production for at least 85% of cumulative target marketing’s
- Definition of Cumulative Target Marketing’s for each month insured has been added to LGM Dairy.
LGM – Cattle
LGM – Cattle provides protection against the loss of gross margin (market value of cattle less feeder cattle and feed costs) on fed cattle (yearling and calf). The policy uses futures prices to determine the expected gross margin and the actual gross margin. LGM does not insure against death, loss, or any other loss or damage to the producer’s cattle. LGM – Cattle is a bundled option that covers both the cost of feeder cattle and the cost of feed. This effectively insures the producer gross margin (difference between the gross margin guarantee and the actual gross margin at the end of the 11-month insurance period).
LGM – Dairy
LGM – Dairy Cattle provides protection against the loss of gross margin (market value of milk less feed costs) on the targeted quantity of market milk. The policy uses futures prices to determine the expected gross margin and the actual gross margin. LGM does not insure against death, loss, unexpected decrease in milk production or unexpected increases in feed use. The mix of target milk marketings and target feed rations allows a producer to select feed rations and production levels that best reflect their actual production. This effectively insures the producer gross margin (difference between the gross margin guarantee and the actual gross margin at the end of the 11-month insurance period).
LGM – Swine
LGM – Swine provides protection against the loss of gross margin (market value of hogs less feed costs). The LGM insurance policy uses adjusted futures prices to determine the expected gross margin and the actual gross margin. The policy does not insure against death, loss, or any other loss or damage to the producer’s hogs. LGM – Swine is a bundled option that covers both the cost of hogs and the cost of feed. This effectively insures the producer gross margin (difference between the gross margin guarantee and the actual gross margin at the end of the 6-month insurance period).
Coverage
The sales period begins each Thursday after the price guarantee is posted to the RMA site and ends the following day (Friday) at 8:25 AM CST for Cattle and Swine and 9:00 AM CST for Dairy Cattle.
Deductible:
- Cattle: $0 – $150 per head (in $10 increments)
- Dairy Cattle: $0 – $2 per hundredweight of milk (in 10 cent increments)
- Swine: $2 – $20 per head (in $2 increments)
Quote Coverage
Our LGM quoting software provides an efficient way for agents, farmers and ranchers to choose the best margin coverage for their Dairy, Cattle and Swine operations by analyzing commodity prices and flexible deductibles. Take a look at LGM weekly margins and rates without having to have a policy set up first! (New rates and margins available on Thursdays, when available through Friday morning sales closing.). Quote LGM now >
Premium Subsidy
- Cattle: Based on the deductible selected by the livestock producer. Subsidy will range from 18% with $0 deductible up to 50% with a deductible of $70 or greater or according to the actuarials.
- Dairy Cattle: Based on the deductible selected by the producer and ranges from 18% with $0 deductible to 50% with a deductible of $1.10 or greater.
- Swine: Based on the deductible selected by the livestock producer. Subsidy will range from 18% with $0 deductible up to 50% with a deductible of $12 or greater or according to the actuarials.
The information contained in this publication is for general purposes only and shall not modify the terms of any insurance policy.
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