Shreya Kalra
The western livestock insurance programme (WLIP) tried to cushion the fastest drop in calf prices since mad cow disease more than a decade ago, but most producers did not sign up for the programme anyway.
WLIP has been making payouts for calf prices that have been dropping consistently in the last few months. Bloomberg reported this as the biggest month-on-month decline since June 2007.
The Western Producer reported that an estimated 14.9% of Saskatchewan calves were signed up for price insurance, but most producers did not buy the relatively low premium in exchange for a high payout.
Approximately $3.3m dollars have been paid under this calf programme by WLIP in Saskatchewan, which includes payments as high as $162 per calf.
Some producers who didn’t opt into the programme believe that they might reluctantly have to sell their calves, which isn’t the case.
Producers purchase insurance for a specific time frame, and they have a three-week period when prices start falling to claim insurance.
This decline in price is not due to a disease outbreak or any climate catastrophe but is actually simply the result of market forces making price corrections.
