The Rainfall Index – Pasture, Rangeland, Forage (PRF) Insurance policy is an area-based insurance plan that covers perennial pasture, rangeland, or forage used to feed livestock. It provides producers a risk management tool to cover forage losses due to lack of the precipitation needed to produce forage for their operation. The coverage is based on precipitation expected during specific intervals and is not design to insure against ongoing or severe drought. This policy is available for all counties in Iowa.
Figure 1. Acres covered by Pasture, Rangeland, Forage insurance in Iowa, 2016-2023
The video presentation below provides an example of how RI-PRF policy coverage can work. NOTE: policy deadlines mentioned at the end are not applicable for current policies. Refer to Table 1 for current deadlines. Additional revisions released in 2021 can be found on the RMA website.
United States Department of Agriculture Risk Management Agency (RMA) offers seven livestock plans and an annual forage insurance plan. Talk to your crop insurance agent to help you decide the option that is right for your operation, or use the Agent Locator to find one near you.
The PRF (Pasture, Rangeland and Forage Insurance) policy is an area-based insurance plan that covers perennial pasture, rangeland, or forage used to feed livestock. It provides producers a risk management tool to cover the precipitation needed to produce forage for their operation. This policy is available for all counties in Iowa.
The video presentation below provides an example of how PRF policy coverage can work. NOTE: policy deadlines mentioned at the end are not applicable for current policies. Refer to Table 1 for current deadlines. Additional revisions released in 2021 can be found on the RMA website.
RMA offers seven livestock plans and an annual forage insurance plan. Talk to your crop insurance agent to help you decide the option that is right for your operation, or use the Agent Locator to find one near you.
Ag Decision Maker offers resources to assist landowners and producers with determining fair pasture rent arrangements.
Contributed by Melissa O’Rourke, retired Iowa State University Extension and Outreach Farm and Agribusiness Management Specialist
As cattle producers move cattle off winter feedlots, discussions are taking place regarding pasture rental rates for the grazing season. Iowa State University Extension and Outreach Ag Decision Maker – along with other university extension services – offer guidelines and resources to help Iowa landowners and producers discuss methods to determine appropriate pasture rental arrangements. Especially during these times of increasing land prices and input costs, parties want to be sure that they are having open discussions to arrive at fair agreements for pasture rents.
There is no quick answer to what is the right rent for a given piece of pasture. Parties must discuss and agree on costs and responsibilities such as real estate taxes, maintenance of infrastructure (fence, barns, water), insurance and fertilization. These issues and more are important factors in calculating a fair rental rate.
One key publication is found on the Ag Decision Maker website: Computing a Pasture Rental Rate. When visiting Ag Decision Maker, notice that the publication is available on screen or via download of a PDF document. There is also a Decision Tool spreadsheet that can be used to try out different calculations. The publication starts out by noting:
“Is there a simple and uniform method of figuring a rental rate for pasture and hay land? Probably not, but guidelines are available. There are several methods for computing a pasture rental rate, and several factors that influence the rental rate. Pasture rental rates vary according to the quality of stand, type of forage species, amount of timber, condition of the fences, availability of water, and previous fertility practices on the pasture. A pasture rental rate can be based on [the following]:
– current market rates – a return on investment in pastureland – forage value – rent per head per month (AUM) – carrying capacity – rent per pound of gain”
Colleagues at the Iowa Beef Center post a good discussion of Pasture Rental and Lease Agreements from the Midwest Perennial Forage & Grazing Working Group. Commentary in this discussion explains that the
“right” amount to charge for pasture rent is highly variable: “Both land owners (lessors) and grazers (lessees or renters) need to determine a fair rental or lease rate. What is a fair amount to charge for rent? The answer is always: “It depends”. The devil is in the details and there can be many details to work out.”
Related to the conversation between pasture landowners and tenants is consideration of fertilization alternatives and guidelines. Parties may wish to review information on pasture improvement alternatives (and costs) at two different ISU publications:
Estimated Costs of Crop Production in Iowa: This publication summarizes crop production costs of multiple rotations. In particular, Annual Production Costs for Established Alfalfa or Alfalfa-Grass Hay are provided on page 10; and Annual Costs per Acre to Maintain Grass Pastures are provided on page 11 of the publication.
Fertilizing Pasture: This publication address grass pasture fertilization rates, timing, and soil quality, including: types of nitrogen; nitrogen rates, response, and profits; and phosphorous and potassium (P-K) rates for legume-grass pastures.
Our colleagues at North Carolina State University Extension (NCSU) have a suggestedform for a pasture lease agreement. As with all such templates, this is only a suggested form that the parties can use to start conversation and make decisions about responsibilities. This NCSU lease agreement indicates some of the details to be worked out between a landowner and a livestock producer – such as improvements, seeding, fertilizer, repair of fences or buildings (if any) or water supply improvements. There is not a single “right way” to do things.
The ISU Cash Rental Rate Survey released each May. Landowners and producers should read the first two pages of the publication describing this opinion survey and definitions of terms used within the report. On the last past of the survey data, readers will find (see bottom of page 12) a summary of typical cash rents from survey respondents on rents for pastures by Crop Reporting District. Remember—these are only the responses of those who completed the survey, and the results can be highly variable and dependent on conditions and the agreement on various items between the landowner and the livestock producer. Note that on page one of the survey, there is a list of variables that may justify a higher or lower than average rent – and one of these is “Other services provided by the tenant.” Again, such services can include stewardship practices (weed control, fertilizer) and repairs (e.g., fencing) – depending on what terms are agreed upon by the parties. It is important for a tenant (livestock producer) to keep track of the costs of services and improvements to the pasture (including labor), and provide that information to the landowner – otherwise, the landowner cannot have a good understanding of these costs.
Overall, communication is key to determining a fair pasture rental rate that works for both the producer and the landowner.
Contributed by Alejandro Plastina, Extension Economist, Assistant Professor, plastina@iastate.edu
If you are a farmer or rancher who faced price declines and additional marketing costs due to COVID-19, you have until August 28, 2020 to file for the Coronavirus Food Assistance Program (CFAP) with your local USDA Farm Service Agency (FSA) office.
The CFAP application form AD-3114 is available online for producers who prefer to fill it out manually. However, according to the Paperwork Reduction Act, filling out the AD-3114 form is estimated to take one hour per response. In order to streamline the CFAP application in times of social distancing and phased reopening of businesses, the USDA has published a CFAP Payment Calculator that serves multiple purposes:
helps producers organize the information needed to apply for CFAP;
informs producers of the initial payment and the potential for subsequent payments;
automatically populates a printable version of the AD-3114 form; and
saves in-person or on-the-phone consultations with FSA staff.
This article provides a step-by-step guide to using USDA’s CFAP Payment Calculator. You will need a computer with internet access and spreadsheet software. In order to print the completed AD-3114 form, you will also need a printer connected to the computer.
Follow these steps to calculate your CFAP payment and print the AD-3114 form:
Open the Calculator from the saved location. A message highlighted in yellow might appear at the top of the spreadsheet asking your permission to “Enable Editing.” Press the gray button with the legend “Enable Editing” to operate the spreadsheet.
If a message highlighted in red appears at the top of your screen indicating “Blocked Content”, then proceed as described in Step 4. If no such message appears, go to Step 5.
Close the file in the spreadsheet software. To allow your computer to run the program embedded in the Calculator (called “Macros”), use the Windows File Explorer (PC computer) or Finder (Mac computer) to browse to the saved file in your computer, click the second mouse button on the file name to access its Properties, locate the “Unblock” option at the bottom, check the Unblock box, and press OK. Then open the file in the spreadsheet software and click on the “Enable Editing” button. The Calculator should be operational.
The spreadsheet is organized into 5 tabs, but you will enter data only on the “Data Entry” tab, and only in the cells highlighted in light-yellow. You only need to fill out the sections relevant to your operation: Dairy, Non-Specialty Crops, Livestock, Aquaculture/Nursery, and Specialty Crops.
Fill out the top section with State, County, Name, and Address.
If you produced Dairy in 2020, fill out Part 1: enter the total pounds of production, including any dumped milk, in January, February, and March 2020. If you do not produce Dairy, leave Part 1 blank.
If you produced corn, soybeans, oats, or other Non-Specialty Crops (including Wool) in 2019, fill out Part 2: in each row, select a crop from the drop-down menu; enter the 2019 total production across all your farms; and the 2019 total production not sold as of January 15, 2020. If your crop is not listed in the drop-down menu of Part 2, then see if it is listed in the drop-down menu of Part 5. If your crop is not listed in Parts 2 or 5, then it is not eligible for CFAP. If you did not produce Non-Specialty Crops in 2019, leave Part 2 blank.
If you owned Livestock in 2020, fill out Part 3: in each row, select a livestock category; enter the total sales between January 15, 2020, and April 15, 2020 for owned inventory as of January 15, 2020, including any sales of offspring from owned inventory; and the highest inventory between April 16, 2020, and May 14, 2020. If you did not own livestock in 2020, leave Part 3 blank.
If you were an Aquaculture/Nursery farmer in 2020, fill out Part 4: in each row, enter the name of the commodity that suffered value loss; the total value of sales from all farms between January 15, 2020 and April 15, 2020; and the total value of marketable inventory from all farms as of April 15, 2020. Note that reported losses in Part 4 are not included in the Calculated Initial Payment reported by this Calculator. USDA is continuing to review data associated with the impact of COVID-19 on value loss crops. Specific value loss crops that meet the eligibility criteria will be identified in the future. If you were not an aquaculture/nursery farmer in 2020, leave Part 4 blank.
If you produced Specialty Crops in 2020, fill out Part 5: in each row, select a crop from the drop-down menu; enter the total value of production sold between January 15, 2020, and April 15, 2020; the total volume of production shipped but not sold between January 15, 2020 and April 15, 2020; and the total acres with production not shipped or sold between January 15, 2020 and April 15, 2020. If your crop is not listed in the drop-down menu of Part 5, then see if it is listed in the drop-down menu of Part 2. If your crop is not listed in Parts 2 or 5, then it is not eligible for CFAP. If you did not produce Specialty Crops in 2020, leave Part 5 blank.
If the CFAP application is for a corporation, a limited liability company, or a limited partnership seeking an increase in the per-person payment limitation, fill out Part 6: enter the names of members/partners or stockholders who provide 400 hours or more of active personal labor or active personal management, or combination thereof, to the farming operation. If 2 or 3 members of the corporation, LLC, or LP are listed in Part 6, the payment limit will be increased from $250,000 to $500,000 or $750,000, respectively. If the application is not for a corporation, LLC, or LP, leave Part 6 blank.
Revise for completeness and correct any mistakes. Check for typos, and make sure you are not leaving out any eligible commodity in the Data Entry tab.
Check your Calculated Initial Payment by clicking on the orange button “GO TO ESTIMATED PAYMENT REPORT” in the top left part of the Data Entry tab. This action will take you to the tab called “ECPR”, and the Calculated Initial Payment amount will appear in the box at the top of the tab. The Calculated Initial Payment equals 80% of the Estimated Gross Payment before limitations and other reductions. For aquaculture/nursery farmers, the Calculated Initial Payment does not include value losses reported in Part 4 (see Step 10).
Your Initial Payment will be the lesser of the Calculated Initial Paymentor $200,000 per individual (equivalent to 80% of the $250,000 payment limit per individual). For corporations, limited liability companies, and limited partnerships, the limit is 80% of the payment limitation calculated in Step 12. You can print the calculations in the “ECPR” tab by clicking on the red button at the top of the tab called “PRINT ECPR.” Go back to the “Data Entry” tab by clicking on the blue button at the top called “GO TO DATA ENTRY”.
Save the file for future reference: go to File menu in your spreadsheet software, and select the Save command.
Print the AD-3114 form by clicking on the yellow button “PRINT AD-3114” in the top left part of the “Data Entry” tab. Depending on the number of eligible commodities you produced, some of your commodities might not show up in the printed AD-3114 form. In that case, click on the light-orange button “PRINT AD-3114 Continuation.” Revise the print out for accuracy, sign, and submit the CFAP application to your local FSA Office.
Any part of your Calculated Initial Payment (see Step 14) below 80% of your payment limit and above YourInitial Payment (see Step 15) might trigger subsequent payments at a later date.
Note that the present article was developed for USDA’s CFAP Payment Calculator Version 1, last accessed on May 29, 2020. The USDA might update the Calculator without prior notice and render some or all parts of this information outdated.