Economic Tidbits

Livestock Forage Disaster Payments

One constant to raising livestock in Nebraska is coping with periodical drought. One tool in producers’ arsenal to manage drought is the USDA Farm Service Agency (FSA) Livestock Forage Disaster Program (LFP). The program provides payments to livestock producers whose pastures and rangeland are impacted by drought. LFP was established by the 2008 Farm Bill and uses eligibility criteria based on county-level drought conditions. The FSA annually sets species-specific per head payment rates designed to cover about 60 percent of monthly feed/forage costs. Livestock in Nebraska eligible for payments include beef, dairy cattle, sheep, goats, and horses.

Figure 2 shows total program payments per 1,000 head of livestock under LFP by county between 2008-2022. During the period, the program distributed more than $12 billion (in 2022 dollars) to livestock producers. Payments peaked in 2012 at more than $3 billion when severe, widespread drought conditions were prevalent. Counties receiving the largest payments were concentrated in the Western, Southern, and Central United States. About 20 percent of counties in the United States did not receive payments. Producers in 90 Nebraska counties received payments and those in 13 counties received more than $5 million, most likely attributable to the 2012 drought.

The scarcity and cost of forage and feed are major concerns for livestock producers during drought. LFP can mitigate these impacts and help producers facing the effects of drought.

FIGURE 2. TOTAL LIVESTOCK FORAGE DISASTER PROGRAM PAYMENTS PER 1,000 HEAD OF LIVESTOCK (2008-2022)

Source: USDA, Economic Research Service

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