The FSA announced this week that March triggered the first payment to dairy farmers enrolled in the Dairy Margin Coverage program. The March income over feed cost margin was $9.15 cwt. Current projections indicate that a DMC payment is likely to trigger every month for the remainder of 2020, a different expectation from last July when some market models had forecast no program payments for 18 months.
FSA Director Richard Fordyce said the payment “comes at a critical time for many dairy producers,” noting it’s the first payment to dairy producers in seven months. Authorized by the 2018 Farm Bill, DMC is a voluntary risk management program that offers protection to dairy producers when the difference between the all-milk price and the average feed price falls below a certain dollar amount selected by the producer.
Although DMC enrollment for 2020 coverage has closed, dairy producers should look for FSA to open sign up for 2021 coverage in July.
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