A proposal submitted to the Federal Crop Insurance Corporation by the American Farm Bureau Federation (AFBF), American Farm Bureau Insurance Services (AFBIS), and others would provide a revenue-based insurance option for dairy farmers, different from the current margin-based insurance options available. AFBF Market Intelligence Director John Newton explains how the Dairy Revenue Protection insurance concept will work for dairy farmers.
Currently, insurance programs offered to dairy farmers all use margin-based instruments. The margin insurance programs protect the difference between the milk price and the feed cost, not revenue. Newton says the most successful tools that farmers are utilizing today are revenue-based instruments, like the AFBF proposal.
He says AFBF has talked with farmers across the U.S. that support the insurance concept, which he expects will be submitted to USDA for review later this fall.
Dairy farmers can learn more about the proposal and provide their comments at www.farmbureausellscropinsurance.com.
Provided by the American Farm Bureau Federation with AFBF Market Intelligence Director John Newton