NMPF schedules Dairy Margin Coverage Webinar for Dec. 2 to help educate producers about coverage options.

November 25, 2020

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The U.S. Department of Agriculture is reminding dairy producers that the deadline to enroll in Dairy Margin Coverage (DMC) for calendar year 2021 is Dec. 11, 2020. USDA’s Farm Service Agency (FSA) opened DMC signup in October to help producers manage economic risk brought on by milk price and feed cost disparities.

FSA Administrator Richard Fordyce said, “2020 has been a challenging year for agricultural producers, and we don't know yet what the next year will bring. Dairy producers should definitely consider coverage for 2021, as even the slightest drop in the margin can trigger payments.”

The DMC program, created by the 2018 farm bill, 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.

The National Milk Producers Federation (NMPF) is offering dairy farmers, cooperative members and state dairy associations a free webinar Dec. 2 to help them develop effective risk management plans that can protect them in what’s predicted to be a volatile year in 2021.

NMPF chief economist Peter Vitaliano, creator of the monthly "Dairy Market Report," will be discussing the dairy price outlook for next year and the value of risk management tools such as DMC in the webinar, which will be moderated by Chris Galen, NMPF senior vice president for member services, at 1:30 p.m. (EST) on Dec. 2.

Participants will be able to ask questions about the year ahead and learn more about how farmers can manage their risk through the expected turbulence. The webinar will examine the milk and feed price forecast, projected margins and how the DMC program will offer farmers protection against price volatility.

For DMC enrollment, producers must certify with FSA that the operation is commercially marketing milk, sign all required forms and pay the $100 administrative fee, unless the dairy operation qualifies for a limited-resource, beginning, socially disadvantaged or military veteran farmers and ranchers waiver.

Producers interested in DMC have the option to select a $4.00/cwt. catastrophic level of coverage with no premium fee, or they can choose to buy up coverage where the premium is based on margin triggers between $4.50 and $9.50 on 5-95% of established production history.

To determine the appropriate level of DMC coverage for a specific dairy operation, producers can utilize the recently updated online dairy decision-making support tool. The decision tool is designed to demonstrate the historical performance of DMC and assist producers with calculating total premium costs and administrative fees associated with participation in DMC. An informational video is available, too.

For producers enrolled in DMC for 2020, the program's fourth payment of the year triggered in September at $9.40. Including the September payment, dairy producers across the country have received 11 monthly payments totaling more than $472 million through DMC since the program began in January 2019.

For more information, visit farmers.gov DMC webpage, or contact a USDA Service Center. To locate a local FSA office, visit farmers.gov/service-center-locator

All USDA Service Centers are open for business, including some that allow visitors to conduct business in person by appointment only. All Service Center visitors wishing to conduct business with FSA, the Natural Resources Conservation Service or any other service center agency should call ahead and schedule an appointment. Service centers that are open for appointments will pre-screen visitors based on health concerns or recent travel, and visitors must adhere to social distancing guidelines. Visitors are required to wear a face covering during their appointment.

Field work will continue with appropriate social distancing. Program delivery staff will be in the office and will work with producers in the office, by phone and using online tools. More information can be found at farmers.gov/coronavirus.

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