The U.S. Department of Agriculture’s Farm Service Agency has announced that Dairy Margin Coverage Insurance payments were triggered in May. The Feed Cost Margin was $5.37 per hundredweight. That’s the third time those payments have been triggered this year. South Dakota Dairy Producers President Marv Post says those funds are both appreciated and helpful.
The DMC program which is a risk management program that offers protection dairy producers when the difference between the all milk price and the average feed price (the margin) falls below a certain dollar amount selected by the producer. Post says that program works very well in South Dakota.
He says one part that wasn’t figured into the DMC was the difference between the cost of regular hay and dairy quality hay.
To date the FSA has issued more than $176 million in program benefits to dairy producers who purchased DMC coverage for 2020. Over 13,000 operations enrolled in the program in calendar year 2020. While that program has closed for this year, signup for the 2021 DMC begins October 13 and runs through December 11, 2020.
