Tag Archives: Dairy

MONTPELIER, Vt. (AP) — An insurance program to help hard-pressed dairy farmers is expected to be ready for enrollment in June, the U.S. Farm Service Agency says, but farmers say it won’t tackle the underlying challenges they face.

Dairy farmers are in their fifth year of low milk prices that have driven thousands out of business.

“I’ve been in this for over 40 years and this is as bad as it’s ever gotten,” said Vermont dairy farmer Jacques Parent on Tuesday.

Describing the dairy farmers’ situation as urgent, 38 U.S. senators signed a letter late last month urging the U.S. Department of Agriculture to implement the insurance program quickly and work to educate farmers about their options.

The improved insurance program in the 2018 farm bill — called Dairy Margin Coverage — expands the coverage levels for farmers. They pay premiums and receive payments when the gap between milk prices and feed prices reach a certain level. The program was delayed by the 35-day partial government shutdown. Payments will be retroactive to January.

“USDA is working diligently to implement the DMC program and other programs authorized by the 2018 Farm Bill,” FSA Administrator Richard Fordyce wrote in an email on Monday.

Still, the more time that passes, the harder it is for farmers.

“I think it’s frustrating, very frustrating because we’ve gone through this four-year drought in revenue and each month it gets put off the more disheartened producers become,” said Michigan dairy farmer Ken Nobis.

Consumer demand in some segments and unresolved trade issues that are harming exports and boosting surpluses are other issues challenging the dairy industry, a spokesman for the National Milk Producers Federation has said.

For many years, dairy farmers went through a three-year cycle of a good year, a bad year and a mediocre year, Nobis said.

“Now we’re in our fifth year of below profitable levels of milk production, that’s pretty hard for anyone to withstand,” he said.

Higher tier coverage is available for smaller operations. Nobis, whose farm milks 1,000 cows, and Parent with 700 cows, would cap out early.

“It’s appreciated but it’s only a little Band Aid,” said Parent.

The bottom line is farmers don’t want a check from the government, said Nobis. “What we want is a viable market and that viable market … has been damaged dramatically by the trade issues that we didn’t ask for, frankly.”

ST. PAUL, Minn. – Hundreds of dairy farmers from across the nation will convene in Saint Paul, Minnesota July 16-18, 2019 for the second annual Dairy Experience Forum to gain a deeper understanding of today’s consumers and how their different values, shopping habits and consumption patterns impact how the industry can collaborate to build dairy demand. Building on the success of last year’s event, Dairy Farmers of Wisconsin is joining Midwest Dairy in co-sponsoring the second annual forum to make a bigger footprint in the dairy community.

The vision for the Dairy Experience Forum is to facilitate conversation and learning among farmers, dairy experts and partners as they discuss useful insights and ideas that can be used in their ongoing work to help ensure a successful future for dairy. As part of the program, attendees will hear from leaders, both from within and outside of the dairy industry, who are translating consumer insights, relevant to variety of generations, into innovative products that meet the needs of consumers of all ages.

The event will provide opportunities to engage with leading experts from research institutions, food companies, retailers and processors, cooperatives and dairy farm operations. It will also allow a platform for dairy farmers to hear from consumers firsthand what attributes and values are important to them as they make purchasing decisions related to the dairy products they enjoy.

“With the mutual goal of sparking new thinking and innovation, we’re excited to collaborate with Dairy Farmers of Wisconsin to co-lead this forward-looking event with an even broader audience, said Midwest Dairy CEO Lucas Lentsch. “By convening a larger representation of the dairy community, we can all gain an even greater perspective on the roles consumers play in driving our industry into the future.”

“We are thrilled to be working together to help farmers and dairy companies better understand consumer mindsets as well as what is driving massive shifts behind product innovation and the way people buy and consume dairy products,” said Dairy Farmers of Wisconsin CEO Chad Vincent. “It is essential we understand what consumers are looking for and how we can meet their needs to drive demand. Anyone from the farm community that is interested in learning how to adapt to these trends is encouraged to attend.”

A confirmed agenda and registration for the forum will be available late April.

Dairy producers who participated in the Livestock Gross Margin for Dairy Cattle Program now can participate in the Margin Protection Program for Dairy for 2018 coverage.

The Department of Agriculture announced the eligibility last week. Producers enrolled in 2018 LGM-Dairy, administered by USDA’s Risk Management Agency under 2014 Farm Bill, were ineligible for coverage under MPP-Dairy, a safety net program available through USDA’s Farm Service Agency. FSA Administrator Richard Fordyce says changes in the 2018 Farm Bill “includes the ability for producers with LGM coverage to retroactively enroll in MPP-Dairy for 2018.”

The MPP-Dairy program offers protection to dairy producers when the difference between the national all-milk price and the national average feed cost falls below a certain dollar amount selected by the producers in a dairy operation. LGM-Dairy is an insurance product that provides protection when feed costs rise, or milk prices drop. This retroactive sign-up is only for dairy producers with 2018 LGM coverage who produced and marketed milk in 2018 but did not obtain full year MPP-Dairy coverage.

USDA Secretary Sonny Perdue’s Feb. 26 announcement of a June 17 signup start for the new Dairy Margin Coverage program has galvanized NMPF efforts to aid members in understanding the new plan as farmers begin to decide how to best incorporate much-needed – and much-improved — assistance into business planning.

In hearings before the House and Senate agriculture committees, Secretary Perdue set the following key dates for dairy-program implementation:

  • March 18 – Producers locked out of the Margin Protection Program last year because they were already enrolled in Livestock Gross Margin-Dairy policies may begin to retroactively enroll in Margin Protection Program coverage for 2018, pursuant to the program as modified last year by the Bipartisan Budget Act.
  • April 15 – Producers will have access to an updated online decision tool to help evaluate their options under the new Dairy Margin Coverage Program, the successor to the Margin Protection Program.
  • April 30 – Producers will be able to receive to partial refunds of Margin Protection Program premiums pursuant to a farm-bill provision allowing the payback.  Secretary Perdue noted that this provision is happening later than hoped; for the first two years of MPP, producer premium and payment information was recorded by hand rather than electronically, thus creating a need to first re-enter that information electronically.
  • June 17 – DMC signup scheduled to begin.
  • July 8 –DMC payments scheduled to begin, retroactive to Jan. 1.

 

Perdue and top USDA officials, at NMPF’s urging, have prioritized DMC implementation as part of the farm bill – and indeed, dairy signups rules will be in place before those of crop programs such as the ARC and PLC programs.

NMPF is also engaging key government leaders who have oversight over the process. When the government shutdown ended in late January, NMPF sent a letter to Secretary Perdue urging USDA to quickly open DMC sign-up while allowing producers adequate time for decisions. NMPF also asked the department to conduct aggressive outreach to producers across the country, using multiple mediums to target not only those who had signed up for the previous program, but also those who had not.

NMPF Outlines Dairy-Program Priorities

Those efforts complement NMPF’s own efforts, which include a farm bill resources page on its website and presentations on the importance of the program before producer groups and farm organizations.

NMPF is urging USDA to implement the DMC in a responsive, farmer-friendly manner. This includes:

  • Providing producers with their net premium refunds under the old Margin Protection Program in advance of the DMC sign-up, which will be important in many cases to producers’ sign-up decisions for the future.
  • Showing significant flexibility to producers who have made changes to their production history due to changes in the structure of their operations, especially due to intergenerational farm transfers or cases where farmers have exited the business and later reconstituted as new entities.
  • Allowing producers to pay their premiums in installments, whether they select annual enrollment or the five-year enrollment option.
  • Allocating funding to updating the decision tool and other related producer education efforts.
  • Incorporating high-quality alfalfa hay costs now required of the National Agricultural Statistics Service into the DMC feed cost formula to ensure that the formula more accurately reflects producer costs.
  • Urging USDA to ensure that the Farm Service Agency, which runs DMC, and the Risk Management Agency, which runs the Livestock Gross Margin and Dairy-Revenue Protection programs, are fully coordinated and informed on this point so that producers do not face any hurdles in signing up for both programs – an option now available under the new farm bill — should they choose to.

COLUMBUS, Neb. – Faith Junck, a 17-year-old from Carroll, was crowned the Nebraska Dairy Princess during the annual Nebraska State Dairy Convention in Columbus Feb. 26th.

Junck is the daughter of Dwaine and Priscilla Junck, and is a junior at Wayne High School. Her role as princess will be to make public appearances to help people understand the dedication of dairy farm families to their cows, their land and the milk they produce. Midwest Dairy sponsors the dairy princess program on behalf of Nebraska’s dairy farm families.

The new princess currently serves as secretary of her school’s FFA chapter. Junck helps her parents on the family dairy farm, and she also shows cattle at the Wayne County Fair. Her school involvement includes FBLA, band, cross country and track, and she is active in her church.

Whitney Hochstein, a 16-year-old from Wynot, Nebraska was named first runner-up to the Nebraska Dairy Princess. She is the daughter of Neal and Sharlee Hochstein and attends Wynot Public Schools. Her school activities include volleyball, band, choir, One Acts and National Honor Society. She is also an active volunteer in her church.

Both the princess and the runner-up receive scholarships from Midwest Dairy.

WASHINGTON— The U.S. Department of Agriculture’s Farm Service Agency (FSA) announced this week that the January 2019 income over feed cost margin was $7.99 per hundredweight, triggering the first payment for eligible dairy producers who purchase the appropriate level of coverage under the new but yet-to-be established Dairy Margin Coverage (DMC) program.

DMC, which replaces the Margin Protection Program for Dairy, is a voluntary risk management program for dairy producers that was authorized by the 2018 Farm Bill. DMC offers protection to dairy producers when the difference between the all milk price and the average feed cost (the margin) falls below a certain dollar amount selected by the producer.

Agriculture Secretary Sonny Perdue announced last week that sign up for DMC will open by mid-June of this year.  At the time of sign up, producers who elect a DMC coverage level between $8.00 and $9.50 would be eligible for a payment for January 2019.

For example, a dairy operation with an established production history of 3 million pounds (30,000 cwt.) that elects the $9.50 coverage level for 50 percent of its production could potentially be eligible to receive $1,887.50.

Sample calculation:
$9.50 – $7.99 margin = $1.51 difference
$1.51 times 50 percent of production times 2,500 cwt. (30,000 cwt./12) = $1,887.50

The calculated premium for coverage at $9.50 on 50 percent of a 3-million-pound production history for this example would be $1,650.

Sample calculation:
3,000,000 times 50 percent = 1,500,000/100 = 15,000 cwt. times 0.150 premium fee = $1,650

Operations making a one-time election to participate in DMC through 2023 are eligible to receive a 25 percent discount on their premium for the existing margin coverage rates.

“Congress created the Dairy Margin Coverage program to provide an important financial safety net for dairy producers, helping them weather shifting milk and feed prices,” FSA Administrator Richard Fordyce said. “This program builds on the previous Margin Protection Program for Dairy, carrying forward many of the program upgrades made last year based on feedback from producers. We’re working diligently to implement the DMC program and other FSA programs authorized by the 2018 Farm Bill.”

Additional details about DMC and other FSA farm bill program changes can be found at farmers.gov/farmbill.