USDA Announces January DMC Payment Level

While the Dairy Margin Coverage (DMC) program is still being put together, USDA announced the January 2019 income over feed cost margin was $7.99 per hundredweight (cwt), a mark that would trigger a payment for some producers under the program. 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. USDA said that a dairy operation with an established production history of three million pounds that elects $9.50 coverage level on 50% of their production could receive $1,887.50. 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. 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.