milk supply

Review Changes to the Margin Protection Program for Dairy Before June 1 Deadline

Brian GermanDairy & Livestock, Industry

Dairy producers are encouraged to review changes to the Margin Protection Program for Dairy before the June 1 deadline.  Enrollment for the program first opened in early April after the US Department of Agriculture (USDA) announced changes that came about as a result of the Bipartisan Budget Act that was passed by Congress in February.  Several informational meetings were held explaining some of the major changes to the program, including the retroactive coverage.Changes to the Margin Protection Program

“It even includes the months behind us, going back to January 1.  So typically, sign-ups occur in the fall for the following year, but due to program changes USDA allows the retroactive coverage and so for some producers there could be some money to be had because we already know what the margins were,” said Director of Economic Analysis for Western United Dairymen Annie AcMoody.

Some of the changes to the program include Tier 1 increases of eligible production coverage to five million pounds, as well as a lowering of Tier 1 premium rates.  The first five million pounds of Tier 1 production will also receive coverage up to a $5 margin for no cost.  “For those who are able to get their production within the 5 million pounds, it can work out to be really beneficial,” AcMoody noted.

Other noteworthy changes to the Margin Protection Program for Dairy include an administrative free exemption for veteran, disadvantaged, beginning and limited-resource producers.  Those who qualify under one of those classifications for an exemption can request a refund of previous fees paid.  Margin calculations will also now be monthly instead of being based on two-month periods.

Even if producers had already enrolled in the program during the previous sign-up period last fall, USDA is requiring the selection of new coverage for 2018.  Dairy operations have the option of either participating in the MPP or the Livestock Gross Margin Insurance Program or not enroll in either program.


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Brian German

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Ag News Director, AgNet West