Dairy Margin Coverage signups set to begin

Producers have two months to opt-in for price support to offset milk and feed price differences.

Joshua Baethge, Policy editor

February 26, 2024

2 Min Read
Dairy cows eating feed in freestall barn
Getty Images/Grigorenko

Dairy producers may begin enrolling in the 2024 Dairy Margin Coverage program on Wednesday. The USDA safety net program offers price support to offset milk and feed price differences. Farmers have until April 29 to sign up.

This year, USDA’s Farm Service Agency revised regulations to allow eligible dairy operations to make a one-time adjustment to their established production history.

“In reviewing 2023 margins and the more than $1.2 billion in Dairy Margin Coverage payments issued to producers, Dairy Margin Coverage is proven to be a program to reduce risk for our dairy producers,” Farm Service Administrator Zach Ducheneaux says. “If 2023 taught us anything, it’s that we honestly have no idea what will happen in the market in any given year.”

Ducheneaux adds that at $0.15 per hundredweight for $9.50 coverage, DMC is a relatively inexpensive investment in a “true sense of security and peace of mind.”

National Milk Producers Federation President and CEO Gregg Doud says his group is pleased to finally have certainty regarding when dairy producers can begin signing up. NMPF has been pushing for USDA to begin the enrollment process, which was delayed by technical issues at USDA county offices.

According to Doud, the DMC program has improved in recent years thanks to the permanent incorporation of updated production histories. He says recent low producer margins underscore how critical the program is for operations of all sizes.

“NMPF is eager to assist producers in any way they can with this program,” Doud says. “We also look forward to working to ensure that farmers receive what they need even more – a new farm bill that provides certainty for the next several years, and not just 2024.”

DMC payments are calculated using updated feed and premium hay costs. The feed calculations are based on 100% premium alfalfa hay. Dairy operations enrolled in the 2023 DMC program under a multi-year lock-in contract will have their lock-in eligibility extend until Dec. 31. Those enrolled in multi-year lock-in contracts are also eligible for a discounted rate for 2024.

Payments may begin as early as March 4 for milk produced in January.

About the Author(s)

Joshua Baethge

Policy editor, Farm Progress

Joshua Baethge covers a wide range of government issues affecting agriculture. Before joining Farm Progress, he spent 10 years as a news and feature reporter in Texas. During that time, he covered multiple state and local government entities, while also writing about real estate, nightlife, culture and whatever else was the news of the day.

Baethge earned his bachelor’s degree at the University of North Texas. In his free time, he enjoys going to concerts, discovering new restaurants, finding excuses to be outside and traveling as much as possible. He is based in the Dallas area where he lives with his wife and two kids.

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