announcement

Ag Groups Applaud Dairy MPP Exit Announcement

Dan Dairy & Livestock, Industry News Release

American Farm Bureau Federation

announcementThe following statement may be attributed to Zippy Duvall, president, American Farm Bureau Federation:

“The American Farm Bureau Federation is pleased by today’s announcement by the Agriculture Department to allow dairy farmers to exit the Margin Protection Program for dairy producers. Dairy farmers need access to effective risk management tools. Farm Bureau and our grassroots members look forward to working with USDA and Congress to enhance the dairy safety net.

“The 2014 farm bill introduced the MPP. The program was intended to offer protection against declines in the national average income-over-feed-cost margin — the difference between the milk price and the cost of feed on a dairy. However, dairy farmers participating in the program were required to pay a $100 administrative fee each year for the basic coverage option and once enrolled were required to remain in the program for the five-year life of the farm bill.

“Approximately 24,000 dairy farms, representing 80 percent of the U.S. milk supply, are currently enrolled in the program, however, this year only 2 percent of the milk enrolled participated at levels above the basic coverage option. The low participation rate is due to the poor performance of MPP in providing a viable safety net to dairy farmers.”

National Milk Producers Federation

“The Margin Protection Program (MPP) in its current form has been a disappointment to many dairy farmers, which is why NMPF has been working both with the U.S. Department of Agriculture (USDA) and Congress to make significant improvements to the program. We had earlier suggested to USDA that, given this level of dissatisfaction, one option would be to allow farmers to opt out of the MPP in the coming calendar year.

Today’s announcement to allow farmers to opt out of the program in 2018 is a welcome development, in that it acknowledges the widespread dissatisfaction among farmers enrolled in the program. Simply put, the way the program was enacted in the 2014 Farm Bill, it does not meet the needs of America’s dairy farmers today, and declining participation levels amply illustrate farmers’ disenchantment with the MPP. Farmers who choose to opt out of the MPP will then be able to enroll in the Livestock Gross Margin program for 2018.

“Looking ahead, Congress must make more resources available to the MPP, so that the program provides a more effective, affordable safety net – one that provides support when farmers need it. We are currently working with lawmakers to secure program improvements that will restore farmers’ faith in the value of the MPP. We also will continue to work with USDA and Congress to develop additional risk management options for dairy producers.”