USDA Urges Timely Enrollment for Dairy Margin Coverage
The U.S. Department of Agriculture (USDA) has issued a reminder to dairy producers across the nation regarding the upcoming deadline for enrollment in the Dairy Margin Coverage (DMC) program. Producers must sign up by February 26, 2026, to secure financial protection against the volatility of milk and feed prices for the current coverage year. The program, a crucial safety net for the dairy industry, is administered by the USDA's Farm Service Agency (FSA).
Program Enhancements and Reauthorization for 2026
The 2026 DMC program introduces several key improvements, largely due to the reauthorization under the 'One Big Beautiful Bill Act' (OBBBA), which extends the program through 2031. A significant change for this year is the increase in the Tier 1 coverage level from 5 million pounds to 6 million pounds of milk. This enhancement allows more production to be covered at lower premium rates. Additionally, all dairy operations enrolling for 2026 will establish a new production history.
- Existing dairy operations that began marketing milk on or before January 1, 2023, will use the higher of their milk marketings from 2021, 2022, or 2023 to establish their production history.
- New dairy operations that started after January 1, 2023, will use their first year of monthly milk marketings, even if it's a partial year.
Producers also have the option to lock in coverage levels for six years (2026-2031), which includes a 25% discount on annual premiums.
Understanding the Dairy Margin Coverage Program
The DMC program is a voluntary risk management tool designed to provide financial assistance to dairy farmers when the margin—the difference between the all-milk price and the average feed cost—falls below a selected coverage level. This mechanism helps ensure more predictable and stable income for dairy producers by offsetting the impact of market fluctuations.
Eligible applicants include dairy operations in the United States that produce and commercially market milk from cows. To enroll, producers must provide production records and adhere to conservation regulations. Coverage levels range from $4.00 to $9.50 per hundredweight (cwt) of milk, in $0.50 increments. Catastrophic coverage at $4.00 per cwt is available at no cost, aside from an administrative fee.
Enrollment Process and Support
Dairy producers interested in enrolling in the DMC program must complete and submit an application to their local FSA office during the specified enrollment period. The application process requires providing production records and selecting the desired coverage level. The USDA Farm Service Agency encourages producers to contact their local office to schedule an appointment and confirm necessary paperwork.
0 Comments