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Margin Protection: Who’s Opted In?

27 January 2015

US – Over half of America’s dairy industry has chosen the 2014 Farm Bill’s safety net, the Margin Protection Programme (MPP), although there are huge regional differences in signatories.

More than 23,000 dairy farms enrolled in the MPP for this season, with more potentially able to join for the 2016 season, pooling almost 120 billion pounds of milk.

Offering flexibility, the MPP beat several farm safety-net programmes when it was introduced along with the 2014 Farm Bill.

Producers are able to select varying levels of coverage at different premiums. The US Department of Agriculture estimates 55 per cent applicants have opted for higher coverage than the “basic level” of $4 per hundredweight.

Nevada has seen the greatest proportion of farms enrol at 90 per cent, while Texas, at 71 per cent, and California and Minnesota, at 69 per cent, welcomed the most of the top ten dairying states.

Overall enrolment was 51 per cent for the big ten, largely due to lack of interest in Pennsylvania – 30 per cent of farm opted, although 58 per cent of these opted to “buy-up”. Overall, national MPP adoption was 50 per cent. 

Contrastingly, New Mexico, one of the big ten, reported 64 per cent enrolment and only 17 per cent selecting to “buy-up”.

Only five per cent of Wyoming’s farmers enrolled.

Speaking at the release of the MPP launch figures earlier this month, Agriculture Secretary, Tom Vilsack said enrollment “far exceeded” government expectations.

"We're pleased that so many dairy producers are taking advantage of the expanded protection,” he said. “USDA conducted a lot of outreach to get the word out.”

“When you compare the initial enrollment rate for the Margin Protection Program to the longstanding federal crop insurance program, where participation ranges from 30 per cent to 80 per cent depending on the crop, it's clear that these outreach efforts made a difference."

Jim Mulhern of the National Milk Producers Federation described the numbers as a “vote of confidence” for the new programme. He stressed the importance the MPP during times of adverse conditions and ahead of a year when “margins will be compressed.”

Dairy producers interested in enrolling in the Margin Protection Program for Fiscal Year 2016 can register between July 1, 2015 and September 30, 2015.

Michael Priestley

Michael Priestley
News Team - Editor

Mainly production and market stories on ruminants sector. Works closely with sustainability consultants at FAI Farms

 


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