{"id":4525,"date":"2026-10-28T09:03:37","date_gmt":"2026-10-28T14:03:37","guid":{"rendered":"https:\/\/agrilife.org\/agecon\/?p=4525"},"modified":"2026-10-28T09:11:16","modified_gmt":"2026-10-28T14:11:16","slug":"usda-management-tool-helps-mitigate-drought-losses-through-prf","status":"publish","type":"post","link":"https:\/\/agrilife.org\/agecon\/usda-management-tool-helps-mitigate-drought-losses-through-prf\/","title":{"rendered":"USDA Management Tool Helps Mitigate Drought Losses Through PRF"},"content":{"rendered":"
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\"Dry
West Texas on Thursday, Dec. 8, 2022. Michael Miller\/Texas A&M AgriLife Marketing and Communications)<\/figcaption><\/figure>\n<\/div>\n\n\n

In recent years, drought has become a common occurrence in Texas. Currently, the U.S. Drought Monitor reports that approximately 90.5% of Texas is experiencing some level of drought as of October 22, 2026 (Figure 1). Producers are increasingly adopting the USDA’s Pasture, Rangeland, and Forage Insurance Program (PRF), recognizing its important role in supporting ranchers during these challenging conditions. In 2024, Texas enrolled 42.8 million acres in the program, a 191% increase from 2011.<\/p>\n\n\n\n

One of the most attractive features of this program is its potential to generate positive net benefits, with indemnity payments exceeding premium costs in many cases. More importantly, it provides significant support during the years when producers need it most.<\/p>\n\n\n\n

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\"Map
Figure 1. Texas Drought Monitor<\/figcaption><\/figure>\n\n\n\n

Pasture, Rangeland, and Forage Insurance Program Review<\/h2>\n\n\n\n

The enrollment deadline for the USDA’s Pasture, Rangeland, and Forage Insurance Program (PRF) is December 1. Commonly referred to as rainfall insurance, the program was developed to reduce the economic impacts of inadequate rainfall. It provides insurance coverage for grazing pasture, rangeland, and forage acres, whether irrigated or non-irrigated.<\/p>\n\n\n\n

How Does It Work?<\/h2>\n\n\n\n

The program does not directly measure drought severity or forage losses. Instead, it measures precipitation levels relative to the historical average for a specific area. The National Oceanic and Atmospheric Administration (NOAA) developed a rainfall index that tracks precipitation within designated geographic grids. Indemnities are triggered when actual rainfall falls below the historical average for that grid.<\/p>\n\n\n\n

PRF Example<\/h2>\n\n\n\n

As we do each year, we will use an example to illustrate the benefits of this program. For this example, we will use the USDA support tool (https:\/\/public-rma.fpac.usda.gov\/apps\/PRF) to estimate premium costs, evaluate coverage options, and review historical results dating back to 1948.<\/p>\n\n\n\n

This year, we will use a 1,000-acre operation located near our Research Center farm in Hardeman County (Grid ID: 16922; Image 1).<\/p>\n\n\n\n

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Image 1. Pasture, Rangeland, Forage Support Tool. (USDA-RMA)<\/figcaption><\/figure>\n\n\n\n

First, after selecting the farm location, we choose the intended use of the insured acres (grazing or haying), production practices (irrigated, organic, etc.), and the coverage level (70%, 75%, 80%, 85%, or 90%). For this example, we will use the default coverage level of 90% and a productivity factor of 100%. However, producers can adjust the productivity factor to better reflect the productivity of their operation.<\/p>\n\n\n\n

We also need to select a sample year. Since 2026 has not yet ended, we cannot use it as an example. Instead, we will use results from 2025, a year marked by drought conditions.<\/p>\n\n\n\n

Second, we must decide how to allocate insurance coverage across the year using bi-monthly intervals. There are several allocation strategies available, and producers should discuss these options with their insurance agent. In this example, we will use one of the most common approaches by distributing coverage evenly throughout the year.<\/p>\n\n\n\n

In previous examples, we have also highlighted strategies that concentrate coverage during periods when forage production is most critical. The even-allocation strategy generally produces a greater number of smaller indemnity payments. In contrast, concentrating coverage during key forage production periods typically results in fewer payments, but larger indemnities during summer droughts when forage losses have the greatest economic impact.<\/p>\n\n\n\n

For this example, coverage is allocated evenly across all six intervals:<\/p>\n\n\n\n