USDA Extends Dairy Margin Coverage Deadline One Week

(WASHINGTON, DC) USDA extended the deadline for dairy producers to enroll in the new Dairy Margin Coverage (DMC) program for 2019. The deadline, originally September 20th, has been extended one week to Friday, September 27th. Authorized by the 2018 Farm Bill and available through USDA’s Farm Service Agency (FSA), the program offers reasonably priced protection to dairy producers when the difference between the all-milk price and the average feed cost (the margin) falls below a certain dollar amount selected by the producer. More than 21,000 dairy operations have signed up for the new program, which has paid out almost $230 million so far this year. Almost half of the producers who have signed up so far are taking advantage of the 25 percent premium discount by locking in for five years of margin protection coverage. Margin payments have triggered for each month this year so dairy producers who elected higher coverage levels could be eligible for payments for all seven months. Under certain levels, the amount paid to dairy farmers will exceed the cost of the premium. For example, a dairy operation that chooses to enroll for 2019 with an established production history of 3 million pounds and elects the $9.50 coverage level on 95 percent of production will pay $4,275 in total premium payments for the entire year but will receive more than $15,000 in DMC payments.