The USDA FSA has announced that enrollment for the Dairy Margin Coverage (DMC) program is open from Oct 13, 2020 until Dec 11, 2020.
According to the USDA FSA website: “The 2018 Farm Bill authorized the new Dairy Margin Coverage (DMC) program, which is a voluntary risk management program for dairy producers. DMC replaces the Margin Protection Program for Dairy (MPP-Dairy). DMC continues to offer protection to dairy producers when the difference between the all milk price and the average feed price (the margin) falls below a certain dollar amount selected by the producer.
To participate in DMC, dairy producers:
- Select a coverage level ranging from $4.00 to $9.50 per cwt, in $0.50 increments
- Select a coverage percentage of the dairy operation’s production history ranging from 5 percent to 95 percent, in 5 percent increments
Producers have the choice to lock in coverage levels until 2023 and receive a 25 percent discount on their DMC premiums.
Dairy operations who paid MPP-Dairy premiums during any calendar year from 2014 through 2017 may be eligible to receive a repayment for part of the premiums paid into the program. Through September 20, 2019, an operation either can elect to receive 50 percent of the repayment amount as a cash refund or take 75 percent of the amount as a credit that can be used toward premiums for DMC.”
According to the FSA, about half of the dairy operations with established production history are enrolled in the DMC program, with an average of about $14, 592 to be paid to each operation. In New York state specifically, only about 29% are enrolled, with an average expected payment of about $12,781 per operation.
The program offers a decision tool to help individual farmers decide which coverage level is best for their operation. Check out the tool at: https://www.fsa.usda.gov/programs-and-services/farm-bill/farm-safety-net/dairy-programs/dmc-decision-tool/index
For more information, visit the USDA FSA Dairy Margin Coverage website: https://www.fsa.usda.gov/programs-and-services/dairy-margin-coverage-program/index