The La Crosse Tribune reports that the Margin Protection Program for Dairy allows farmers to buy insurance that pays out when the cost to produce milk becomes too close to milk’s selling price.
But Wisconsin dairy farmers say the program doesn’t fully account for feed, supplements and transportation costs.
More than 6,500 dairy farmers signed up for the program in its first year, but participation fell to less than 5,300 last year, with most farmers buying coverage for when margins fell below $4.
U.S. Sen. Tammy Baldwin introduced changes to the program that would lower the cost of premiums for small- and medium-sized producers. Farmers are now also allowed to participate in other risk management programs.
Baldwin met with Wisconsin dairy farmers in La Crosse and Altoona on Feb. 19, to discuss the major investments and significant improvements to dairy programs that she fought to be included in the bipartisan Senate budget agreement.
At each event, dairy farmers in attendance acknowledged that Senator Baldwin’s efforts, including securing $1 billion for the Dairy Margin Protection Program (MPP) and improvements to dairy programs, will help provide much-needed, immediate relief as they face difficult dairy market conditions.
“Wisconsin’s dairy industry is a key driver of our state’s agricultural economy and a core part of our rural communities,” said Senator Baldwin in a news release. “The dairy farmers I met with today agree: Washington has been far too slow to recognize the challenges facing our agriculture economy. That’s why I worked to make sure the Senate’s bipartisan budget agreement includes the tools we need to act quickly in the face of this crisis. I am proud we secured this much-needed relief for our dairy farmers. We are doing right by them and Wisconsin’s rural economy.”
Since 2014, prices have dropped by over a third and dairy farmers have faced these difficult market conditions without a reliable safety net, according to Baldwin’s release.
In January, Baldwin sent a letter to Senate leadership urging them to protect the economic security of the nation’s dairy farmers and update and expand the Dairy MPP in advance of the Farm Bill to provide better risk management tools for family farmers. Unfortunately, the program has not worked as intended due to last minute cuts from House Republicans and implementation problems at USDA.
The bipartisan plan that passed Congress would fix problems with the old MPP and provide a pathway to new, customizable insurance tools in the future.
Specifically, the bipartisan proposal would:
Make a Significant Investment for Dairy — Invest over $1 billion into the dairy safety net for family dairy farmers.
Increase Affordability — Eliminates or slashes premiums by up to 80 percent for small and medium dairy farms.
Target Those Most in Need — Waives administrative fees for beginning, veteran, and underserved farmers.
Make Farmer-Friendly Improvements — Makes the program more responsive to drops in prices and increases in feed costs, and triggers payments more quickly.
Allow Flexibility — Provides farmers with an immediate chance to sign-up or change coverage levels for 2018 coverage.
Create New Opportunities for Insurance — Removes arbitrary limits on developing new dairy insurance tools in the future, allowing for the creation of customizable dairy risk management tools.
The Associated Press contributed to this article.