There have been effective USDA supported insurance programs available for many years for agricultural crops such as corn, soybean, and wheat, but there has been a need to have good, cost effective programs to insure the vast amount of acreage that we have in the U.S. and in Pennsylvania dedicated to pasture and hay land to support our livestock industries.

For 2007, the USDA Risk Management Agency developed and offered two new pilot risk management programs for pasture, rangeland, and forage. One of these programs is based on vegetation greenness. The other program is based upon rainfall indices.

Both were developed to provide livestock producers the ability to purchase, at affordable prices, insurance protection for losses of forage produced for grazing or harvested for hay, due to negative precipitation variations.

These programs were developed to become a risk management tool for the 588 million acres of U.S. pastureland and the 61.5 million acres of hay land. Beginning with the 2007 crop year, the pilot programs were made available for a limited number of acres for testing in selected states. These products use innovative technology to assess losses in forage production across diverse range and pasture environments.

The rainfall index program was tested in 2007 in 220 counties in Colorado, Idaho, Pennsylvania, South Carolina, North Dakota, and Texas. This included the 17 southwestern Pennsylvania counties as far north as Mercer, Venango, Clarion, Jefferson, Lawrence, Butler, and Armstrong.

The vegetation index was tested in 110 counties in Colorado, Oklahoma, Oregon, Pennsylvania, South Carolina, and South Dakota. This program included the nine counties in the extreme northeastern portion of Pennsylvania.

The rainfall index is based on National Oceanic and Atmospheric Administration data and uses an approximate 12-mile by 12-mile grid. Producers must select at least two, 2- month time periods in which precipitation is important during the growth and production of the forage species. These time periods are called index intervals.

Insurance payments to a producer suffering a loss are calculated based on the deviation from normal precipitation within the grid and index interval(s) selected. This insurance coverage is for a single peril — lack of precipitation.

The vegetation index uses data from the U.S. Geological Survey Earth Resources Observation and Science data center. The VI is an alternative measure of vegetation greenness and correlates to forage condition and productive capacity in approximately 4.8-mile by 4.8-mile grids. In general, the healthier the plants in a given grid, the higher the VI value. This information is collected by satellite imagery.

Even though the northwestern counties — Erie, Crawford, Warren, Forest — were not included in the original pilot program that is in effect for 2007, it is anticipated that the program will be opened to all counties in 2008.

It is also anticipated that the vegetative program will be used for all counties, except the 17 Southwestern counties that are using the Rainfall Index program currently.

So look for more information coming from USDA — Risk Management Association in the near future on availability in your area.

Producers are not required to insure all acres. This allows a producer to insure only those acres that are important to his or her grazing program or hay operation.

By selecting a productivity factor, a producer can establish a value between 60 and 150 percent of the county base value and match the amount of protection to the value of forage that best represents his or her specific grazing or hay operation, as well as the productive capacity of the land.

The producer will be asked to make several choices when insuring grazing land or hay land production, including coverage level, index intervals, productivity factor, and number of acres.

Since negative index variations are determined by existing and time tested government systems, no producer recordkeeping is required. Premium costs are made more affordable by cost sharing by both USDA and the state.

Sales closing date is November 30.

Luke Fritz is executive director of the Butler County Farm Service Agency.