The Margin Protection Program for Dairy Producers (MPP-Dairy) replaces MILC and is effective through December 31, 2018. The Margin Protection Program offers dairy producers: (1) catastrophic coverage, at no cost to the producer, other than an annual $100 administrative fee; and (2) various levels of buy-up coverage. Catastrophic coverage provides payments to participating producers when the national dairy production margin is less than $4.00 per hundredweight (cwt). The national dairy production margin is the difference between the all-milk price and average feed costs. Producers may purchase buy-up coverage that provides payments when margins are between $4.00 and $8.00 per cwt. To participate in buy-up coverage, a producer must pay a premium that varies with the level of protection the producer elects. – Read details about MPP-Dairy.
View the MPP-Dairy Summary and Graphics. This illustrates how payments would have differed from the former dairy program (MILC) that paid dairy producers $1.6 billion since 2009, whereas MPP-Dairy would have paid $2.54 billion.
Visit Webtool to Explore Coverage Options from the MPP-Dairy
In addition, the 2014 Act created the Dairy Product Donation Program. This program is triggered in times of low operating margins for dairy producers, and requires USDA to purchase dairy products for donation to food banks and other feeding programs. – Learn more about the Dairy Product Donation Program (pdf)
Alfalfa Hay ($/ton)
Soybean Meal ($/ton)
All Milk ($/cwt)
|Final Feed Costs for MPP-D ($/cwt)||Milk Margin Above Feed Costs ($/cwt)|
Milk Margin /pay Period*
*At a milk margin minus feed costs of $8 or less, payments are possible depending on the level of coverage chosen by the dairy producer.
Corn, Alfalfa hay and All-milk full month prices (not preliminary) can be found in the National Agricultural Statistics Service (NASS) Agricultural Prices monthly publication.
Soybean Meal prices can be found in the Agricultural Marketing Service (AMS) daily Central Illinois Soybean Processor report . (Go to the 48% Soybean Meal R monthly price at the bottom of the report).
Handbook MPP-1 Margin Protection Program for Dairy Farmers