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UPDATE: USDA has extended the deadline for dairy producers to sign up for the Farm Service Agency’s Margin Protection Program – Dairy (MPP) through Friday, June 22. All dairy operations must make new coverage elections for 2018, even if the operation was enrolled during the previous 2018 signup period that ended in December 2017. Coverage elections made for 2018 will be retroactive to Jan. 1, 2018.

PREVIOUSLY: Dairy farmers are being encouraged to enroll in the new and improved Margin Protection Program for Dairy now through June 1. MPP-Dairy changes authorized under the Bipartisan Budget Act of 2018 will provide better protections for producers from shifting milk and feed prices, according to the U.S. Department of Agriculture.

It also is retroactive to cover all of 2018.

Key changes to the new MPP-Dairy program include:

• Improving the ability for dairy farmers to use the Livestock Gross Margin (LGM-Dairy) program and other insurance options offered through USDA
• Adjusting the first tier of covered production to include each farm’s first 5 million pounds of annual milk production (about 217 cows) instead of 4 million pounds
• Raising the catastrophic coverage level from $4 to $5 for the first tier of covered production for all dairy farmers
• Reducing the premium rates for the first 5 million pounds of production for more affordable coverage
• Changing the margin calculation from a bi-monthly to a monthly basis
• Waiving the annual $100 administrative fee for under-served farmers

“We encourage dairy producers to review the provisions of the updated program, which Congress shaped with their feedback,” said USDA Sec. Sonny Perdue.

John Newton, American Farm Bureau market intelligence director, said that the new MPP is a better safety net for dairy farmers than the previous one, largely because the catastrophic coverage level has increased from 4 to 5 million pounds and the program triggers monthly, instead of every two months.

“Combined, it makes the program much more affordable and timelier in terms of delivering program payments to dairy farmers,” he said.

Determining coverage levels

USDA has a web tool to help producers determine the level of coverage under the MPP-Dairy that will provide them with the strongest safety net under a variety of conditions. The online resource allows dairy farmers to quickly and easily combine unique operation data and other key variables to calculate their coverage needs based on price projections. Producers can also review historical data or estimate future coverage based on data projections. The secure site can be accessed via computer, smartphone, tablet or any other platform.