Dairy farmers urged to accept MPP ‘gift’ | eDairy News

Dairy farmers urged to accept MPP ‘gift’

That’s the advice from Extension Service dairy market specialist Brian Gould in the wake of the 2018 Margin Protection Program (MPP) approved by Congress earlier this year. Based on what’s already known, all those dairy farmers should sign up for the maximum $8 margin protection per 100 pounds of milk, he indicates.

While speaking at the Extension Service’s semi-annual farm management update, Gould described the legislation which was passed on February 9 as “a gift” for dairy farmers, particularly for those with a history of annual milk production of up to 5 million pounds (the approximate equivalent of 200 cows with an annual milk production average of 22,000 pounds).

Gould pointed out that for those dairy farmers the already known MPP payments for February and March alone will significantly exceed the premium costs for all months in 2018 at the $8 per hundred of milk margin for income over feed costs (IOFC) in the payment formula. The premiums are not due until September 1 but a federal budget reconciliation sequester of about 6.6 percent will be deducted from the MPP payments, he added.

The known payment numbers for February and March respectively are approximately $1.12 and $1.23 per hundred at the maximum $8 IOFC. Based on the most recent Class III milk futures prices, payments for April (possibly over $1), May, and June are also likely, Gould observed.

Dairy farmers with an annual milk production of more than 5 million pounds are also eligible for the new MPP but they have less of a guarantee of a return. For them, the special one-year MPP program has premiums starting at 2 cents per hundred for a protected margin of $4.50 per hundred and rising to $1.36 per hundred for the $8 protection. For those under 5 million pounds of milk, the premiums start at a $5.50 margin and rise to only 14.2 cents per hundred at the $8 level of protection.

Gould and fellow dairy economist Mark Stephenson have been making presentations at meetings around the state to acquaint dairy farmers with the opportunity they’ve been given. Before visiting their county FSA office, dairy farmers can also obtain additional information online at https://DairyMarkets.org/MPPvideo and https://dairymarkets.org/MPP/Tool.

By: Ray Mueller

Source: Wisconsin State Farmer

Link: https://www.wisfarmer.com/story/news/2018/05/06/dairy-farmers-urged-accept-mpp-gift/585259002/

Tags: , , ,
Any claim arising from the information contained on the eDairy News website shall be submitted to the competence of the ordinary courts of the First Judicial District of the Province of Cordoba (Primera Circunscripción Judicial de la Provincia de Cordoba), Republic of Argentina, in the city of Córdoba, excluding any other jurisdiction (Federal jurisdiction is also excluded).


Criteria in the moderation of comments that eDairy News will take into consideration in all its publications.

  • They will not be considered insults of any kind against anyone,, whether a user, moderator or publisher. Complaints made with the name and surname of the author of the commentary will only be accepted after confirmation by the moderator.
  • Unsubstantiated and gratuitous destructive criticism or expressions of bad taste, whether offensive, racist or xenophobic.
  • SPAM, (Insert links to web pages not related to the subject, provide emails, etc...)
  • Comments that are meaningless with the footnote or the dairy sector.

Related posts