USDA Opens 2022 Listing For Dairy Margin Coverage

As part of the Biden-Harris administration’s continued efforts to support dairy farmers and rural communities, the United States Department of Agriculture (USDA) opened enrollment in the Dairy Margin Coverage (DMC) program and extended the program to allow dairy producers to better protect their operations by initiating additional production.

This registration period – which runs from December 13, 2021 to February 18, 2022 – allows growers to gain coverage through this important safety net program for another year as well as additional support through the new additional DMC.

Additional DMC will provide $ 580 million to better assist small and medium-sized dairy farms that have increased production over the years but have not been able to record the additional production. From now on, they will be able to retroactively receive payments for this additional production.

Additionally, the USDA Farm Service Agency (FSA) has updated the way feed costs are calculated, which will make the program more representative of the actual expenses of dairy farmers.

“Dairy margin coverage is an essential safety net for producers, and catastrophic coverage is free. These updates to the DMC build on other efforts by the Biden-Harris administration to improve the DMC and other key USDA dairy programs, ”said Robert Bonnie, Undersecretary of Agricultural Production. and conservation. “We encourage dairy farmers to use the support provided by signing up for additional coverage and signing up for the DMC for the 2022 program year.”

Additional DMC registration

Eligible dairy farms with less than 5 million pounds of established production history can list additional pounds based on a formula using actual 2019 milk marketings, which will result in additional payments.

Producers must provide the FSA with their 2019 milk marketing declaration.

Additional DMC coverage is applicable to calendar years 2021, 2022 and 2023.

Participating dairy farms with additional production may receive additional retroactive payments for 2021 in addition to payments based on their established production history.

Additional DMC will require a review of a producer’s 2021 DMC contract and must take place prior to DMC enrollment for the 2022 program year.

Producers will be able to review DMC 2021 contracts and then apply for DMC 2022 by contacting their local USDA service center.

DMC 2022 registration

After making revisions to the 2021 DMC contracts for additional DMCs, producers can purchase 2022 coverage.

DMC provides eligible dairy farmers with risk management coverage that pays producers when the difference between the price of milk and the cost of feed falls below a certain level.

So far in 2021, DMC payments have been triggered from January through October for over $ 1.0 billion.

To register with the DMC, producers must certify with the FSA that the operation markets milk, sign all required forms and pay the administrative fee of $ 100.

The fees are waived for farmers who are considered to be resource-constrained, beginner, socially disadvantaged, or a military veteran. To determine the appropriate level of DMC coverage for a specific dairy operation, producers can use the online dairy decision tool.

Feed cost updates

The USDA is also changing the feed cost formula for the DMC to better reflect the true cost that dairy farmers pay for high-quality alfalfa hay. FSA will calculate the payments using 100% premium alfalfa hay rather than 50%.

The modified feed cost formula will make DMC payments more representative of the actual expenses of dairy producers.

Additional dairy assistance

Today’s announcement is part of a larger package to help the dairy industry respond to the pandemic and other challenges. The USDA is also amending the Dairy Indemnity Payment Program (DIPP) regulations to add provisions for compensating cows that may not be marketable for longer periods, for example due to per- and polyfluoroalkyl substances. .

The FSA has also worked closely with the USDA’s Natural Resources Conservation Service to target assistance through the Environmental Quality Incentive Program and other conservation programs to assist producers to safely dispose of and resolve resource issues created by affected cows.

Other recent dairy announcements include $ 350 million for the Pandemic Market Volatility Assistance Program and $ 400 million for the Dairy Donation Program.

Additional details on these changes to the DMC and DIPP can be found in a rule soon to be published in the Federal Register.

This rule also included information about the new Oriental Fruit Fly program as well as changes to the FSA’s conservation programs.

More information

To learn more or to participate in DMC or DIPP, producers should contact their local USDA service center. Service Center staff continue to work with agricultural producers by phone, email and other digital tools. Due to the pandemic, some USDA service centers are open to a limited number of visitors.

Producers should contact their service center to set up an appointment in person or by phone. Additionally, more information related to USDA’s response and producer relief can be found at farmers.gov/coronavirus.

The USDA touches the lives of all Americans every day in so many positive ways.

In the Biden-Harris administration, the USDA is transforming the American food system with a greater focus on more resilient local and regional food production, fairer markets for all producers, ensuring access to healthy food and in all communities, creating new markets and sources of income for farmers and producers using climate-smart food and forestry practices, making historic investments in clean energy infrastructure and capacity in rural areas America, and a commitment to equity across the Department by removing systemic barriers and creating a workforce that is more representative of America.

To find out more, visit usda.gov.