Dairy farmers have under one month left to sign up for the Dairy Margin Coverage program, which guarantees a payout for cash-strapped producers in 2019.

The DMC is guaranteed to pay all producers enrolled at the maximum $9.50/hundredweight coverage level for every month of production through June, with another payment predicted for July, according to U.S. Department of Agriculture data and forecasts. Enrollment numbers released yesterday indicate that 63% of dairy operations with an established DMC production history have enrolled so far for this year. This represents nearly 17,000 producers nationwide.

“Dairy farmers prefer to get their income from the market, but much-needed payments for the first half of this year provide welcome certainty for farmers,” said Jim Mulhern, National Milk Producers Federation President and CEO. “DMC offers better support for dairy farmers than its predecessor, the Margin Protection Program. It’s worthwhile for every farmer.”

The DMC, created in the 2018 Farm Bill, is a much more robust safety net for dairy producers of all sizes than the Margin Protection Program, which has been discontinued. DMC improvements include:

• Affordable higher coverage levels that permit all dairy producers to insure margins up to $9.50/hundredweight on their Tier 1 (first five million pounds) production history, a higher level than previous programs.

• A new option for producers to receive a 25% discount on their premiums if they agree to lock in their coverage for the five-year period of this Farm Bill. However, producers will be allowed to pay their premiums annually even if they elect the five-year discount.

• The feed-cost formula has been improved to include dairy quality hay values, which better reflects the true cost of feeding dairy cows.

• Affordable $5 coverage that lowers premium costs by roughly 88%. This creates more meaningful catastrophic-type coverage at a reasonable cost for larger producers without distorting the market signals needed to balance supply with demand.

NMPF has a resource page on its new website with more information about the program.

More information can be found at https://www.fsa.usda.gov/programs-and-services/dairy-margin-coverage-program/index. Deadline to apply is Sept. 20.