Online Tool Available for New Dairy Margin Coverage Program

Brian German Agri-Business, USDA-NRCS

Dairy producers will have an online resource available to them that can assist with decisions related to the new Dairy Margin Coverage (DMC) program.  The web-based tool was developed through a collaboration with the University of Wisconsin and was announced by the U.S. Department of Agriculture (USDA) on April 30.  The new resource helps producers with evaluating total premium costs along with administrative fees associated with the program while forecasting payments that would be made during the coverage year.

Dairy Margin Coverage“With sign-up for the DMC program just weeks away, we encourage producers to use this new support tool to help make decisions on participation in the program,” Agriculture Secretary Sonny Perdue said in a press release. “Dairy producers have faced tough challenges over the years, but the DMC program should help producers better weather the ups and downs in the industry.”

The DMC program provides financial support for dairy producers as a means of protection for when the margin between the all milk price and the average cost of feed falls below a specific dollar amount.  Authorized through the 2018 Farm Bill, the new DMC program is designed to be a replacement for the Margin Protection Program for Dairy.

“The new Dairy Margin Coverage program offers very appealing options for all dairy farmers to reduce their net income risk due to volatility in milk or feed prices,” said Dr. Mark Stephenson, Director of Dairy Policy Analysis, University of Wisconsin, Madison. “Higher coverage levels, monthly payments, and more flexible production coverage options are especially helpful for the sizable majority of farms who can cover much of their milk production with the new five million pound maximum for Tier 1 premiums. This program deserves the careful consideration of all dairy farmers.”

Producers interested in learning more about dairy margin coverage options can access the new online tool through the USDA Farm Service Agency website.  The sign-up period for the program will open June 17.

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Brian German

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Ag News Director, AgNet West