LRP-Lamb Contracts Honored on Current Conditions
COVID-19 has impacted the industry on nearly every front, but the U.S. Department of Agriculture – acting on guidance from the American Sheep Industry Association and the Sheep Venture Company – has found one way to blunt a small portion of that damage.
USDA will now use the National Weekly Slaughter Sheep Report comprehensive price – when the formula price is not available to due confidentiality requirements – to determine Actual Ending Values on LRP-Lamb policies purchased prior to the COVID-19 impact.
“The Agricultural Marketing Service has suspended reporting of the National Weekly Slaughter Sheep Review (LM_LM352) formula price to comply with confidentiality requirements,” wrote USDA Risk Management Agency Administrator Martin R. Barbre in a bulletin to insurance providers and RMA field offices this week. “Without the formula price being released by AMS, the Risk Management Agency is unable to publish Actual Ending Values on any active LRP-Lamb endorsements in a manner that reflects current market conditions to appropriately compensate insureds for the coverage purchased prior to the market impacts of COVID-19, which ultimately led the discontinuance of the National Weekly Slaughter Sheep Review formula price.”
“On May 21, 2020, the Federal Crop Insurance Corporation Board of Directors suspended sales of the Livestock Risk Protection for Lamb due to data being unavailable to make offers and settle existing insurance contracts. Effective immediately, RMA will publish AEVs for active endorsements by replacing the National Weekly Slaughter Sheep Review formula price with the comprehensive price when the formula price is not available. The comprehensive price includes formula price transactions in addition to negotiated prices and is designed by AMS to allow price reporting to continue during periods when the formula price report is suspended. Because the comprehensive price includes formula price transactions, it closely follows the formula price.
“For any active LRP-Lamb endorsements, when AMS has not published the formula price for the ending date of the endorsement and the previous four weeks, RMA will use the National Weekly Slaughter Sheep Review comprehensive price to calculate the actual ending value instead of the formula price. RMA will continue to use the formula price to determine the AEVs, as outlined in the policy, if AMS publishes the formula price on the ending date of the endorsement and the previous four weeks.”
ASI Executive Director/SVC Secretary-Treasurer Peter Orwick extends the sheep industry’s appreciation to USDA for finding a work around to the serious issue of not being able to accurately settle insurance contracts due to lack of price reporting because of recent plant shutdowns and changes in purchase of lambs. The industry spent two months providing alternatives, and is pleased that USDA found one that works.
Growers Should Monitor MAL/LDP Rates
Wool producers are encouraged once again to take a look at the wool Marketing Assistance Loan and Loan Deficiency Program offered through their local Farm Service Agency office.
Rates for ungraded, grease wool changed dramatically last week, leading to the availability of a 30 cent per pound benefit. Rates are also favorable in some fine wool ranges, on a clean wool basis, as well as for the coarsest of American wools. The American Sheep Industry Association has been working with the industry and the U.S. Department of Agriculture to see that rates adequately reflect the current wool market. That interaction – along with increased wool price reporting – has led to the most updated rate changes in years.
There is also and unshorn pelt LDP payment, which is 6.865 lbs. multiplied by the LDP rate (30 cents) and comes out to $2.0595 per head this week.
Rates change each Tuesday and can be found on the ASI website, along with a PowerPoint presentation drafted by sheep and wool consultant and PM Ranch Owner Bob Padula that demonstrates various examples to assist growers in looking at options that best suit their operations.
Click Here for more information.
For those growers interested in a loan, the Market Assistance Loan program is now available for up to 12 months – usually it is only available for nine months. More information on all these programs can be found on the FSA Fact Sheet https://www.fsa.usda.gov/Assets/USDA-FSA-Public/usdafiles/FactSheets/2016/mal_ldp_2016.pdf.
ASI Deputy Director Rita Samuelson reminds producers that this program is designed to step in during market crashes and encourages those that haven’t sold their 2020 clip to go into their local FSA office and complete forms to prepare for the date they want to apply for LDP. This is also a good time to ask about program updates and specifics.
ASI SheepCast: Parasites Part 1
On this week’s American Sheep Industry Association SheepCast, Dr. Lisa Williamson of the University of Georgia tackles choosing the right treatment for parasites.
Click Here to listen to the SheepCast.
USDA Lamb Purchase Totals $2.675 Million
The U.S. Department of Agriculture announced this week the purchase of $2.675 million in lamb shanks and chops under the Trade Mitigation Food Purchase and Distribution Program.
USDA purchased 200,000 pounds of lamb shanks and 159,600 pounds of bone-in lamb chops through the program. A total of 119,700 pounds of lamb chops and 80,000 pounds of lamb shanks were not purchased under the program due to vendor constraints.
“We appreciate USDA following through on the previously announced lamb purchase,” said American Sheep Industry Association President Benny Cox of Texas. “We hope the new distribution of lamb will strengthen the live lamb market for sheep producers and benefit needy families who will find American lamb at their local food banks in the months to come.”
USDA has a total of $17 million authorized for lamb meat purchases and ASI will continue to work with the department for prompt usage of the funds this year.
ASI Photo Contest Deadline is Aug. 3
Mark your calendars now, as the deadline for the 2020 ASI Photo Contest is Aug. 3. All entries must be submitted by 5 p.m. mountain time on that date. The top three finishers in each category will receive a cash prize and be featured in the October issue of the Sheep Industry News.
ASI made a change in adding a working dog category in 2019 and it was well received. This year, the association would like to invite those with other protection animals (llamas, donkeys, etc.) to submit photos in that category, as well.
Otherwise, rules and prizes for the 2020 contest are the same as last year. Photographs entered in the contest will be judged on clarity, content, composition and appeal. More than $1,000 will be awarded, with awards of $125 going to the first-place photographer in each of the five categories listed below; $75 for the runner-up in each category; and a $50 prize for third place in each of the five categories. Again, entries must be received in the ASI office by 5 p.m. mountain time on Monday, Aug. 3, to be considered. Only the top three photographers in each category will be notified of their winnings.
Photographers are advised to submit photographs in the largest file size possible. Also, judges and ASI staff encourage entrants to provide both horizontal and vertical photos.
The five categories in this year’s contest are:
- Action – Photographs of activities such as moving/trailing sheep, lambing, tagging, feeding, shearing, etc.
- Scenic (East) – Photographs of sheep outdoors located east of the Mississippi River. Photos entered in this category cannot include people.
- Scenic (West) – Photographs of sheep outdoors located west of the Mississippi River. Photos entered in this category cannot include people.
- Working Dogs and Protection Animals – Photographs in this category should show herding dogs, livestock guardian dogs or any other livestock protection animal in their natural environments. Photos must also include sheep in some fashion, as proof that these truly are working animals.
- Open – Photographs with subject matter that does not fall into the four above-listed categories.
Entries should be emailed to Partain at [email protected] with the subject line of ASI Photo Contest. Those mailing photos should send them to ASI; Attn: Photo Contest; 9785 Maroon Circle, Suite 360; Englewood, CO 80112.
Click Here for complete contest rules.
Australian Wool Prices Rebound Amid Smaller Offerings
The Australian wool market turned in a strong performance this week with all sectors recording positive movements. The national offering fell to 18,828 bales. Due to the lack of quantity, Sydney and Fremantle only required one day of selling.
Melbourne and Sydney opened proceedings on the first selling day and from the opening lot it was apparent that buyer sentiment was greatly improved. This stronger sentiment resulted in price increases across all merino fleece types and descriptions. The individual Micron Price Guides rose by 3 to 32 cents. On the back of these rises, the AWEX Eastern Market Indicator gained 17 cents for the day, climbing to 1,172 Australian cents.
On the second selling day, it was Melbourne and Fremantle in operation. Melbourne recorded minimal movements for the day – the MPGs all traded within 6 cents of the previous day – and the EMI dropped 2 cents. Fremantle enjoyed the gains experienced in the other centers on the previous day, pushing the Western MPGs up by 29 to 38 cents. The EMI rose by 15 cents for the series, closing at 1,170 Australian cents – an increase of just more than 1 percent. Due to a strengthening Australian dollar, the increase in USD terms was higher – a 21 US cent increase – which equated to a 2.7 percent rise. Many sellers were keen to accept the higher prices, resulting in a passed in rate of only 7.9 percent – 4.7 percent lower than the rate of the previous week.
The crossbred sector also lifted. The main rises were in the 26.0 to 28.0 micron range as the MPGs for these wools rose by 9 to 20 cents. The oddments recorded healthy gains for the second successive week. Locks, stains and crutchings generally rose by 20 to 40 cents.
Source: AWEX
Videos of the Week
Where is wool headed in 2020? What are the wool market trends? Wool Market Intelligence is a cornerstone of the industry, and the Market Intelligence Forum is annually the most popular session at the International Wool Textile Organization Congress.
Here, Committee Chair Chris Wilcox and his panel analyze the market for wool and wool-related industries around the world. Wilcox is joined by the following speakers: Sebastian Remøy, KREAB; Madame Peng Yanli, China Wool Textile Association; and Giovanni Schneider, The Schneider Group.
Click Here to watch the video.