USDA in conjunction with its Risk Management Agency recently unveiled the Dairy Revenue Protection (Dairy-RP) program in August of 2018, which is designed to insure against unexpected declines milk sales on a quarterly basis at a guaranteed coverage level. The revenue will be based upon futures prices for milk and dairy commodities with the coverage level elected by the producer.
The I-29 Moo University and Minnesota Milk are co-hosting a webinar – Dairy Revenue Protection: How to Make 2019 an Upside-Only Year, to help explain the details of the program and how producers can participate to help influence the outcome of their individual bottom line break-evens. Dr. Marin Bozic, Assistant Professor in Dairy Foods Marketing Economics in the Department of Applied Economics at the University of Minnesota will be presenting the information on Tuesday, October 23rd from 12:00 p.m. – 1:00 p.m. (CDT) during a webinar. Email firstname.lastname@example.org for more information.
The Dairy-RP is available in all counties in all 50 states of the United States. There are two base pricing options of coverage available.
The Class Pricing Option which uses a combination of Class III and Class IV milk prices as a basis for determining coverage and indemnities.
The Component Pricing Option which uses the component milk price for butterfat, protein and other solids as the basis for determining coverage and indemnities. Producers have the ability under this option to select the butterfat test percentage and protein test percentage to establish the insured milk price.
It is important to note that the Dairy-RP insurance covers losses for the difference between the final revenue guarantee and actual milk revenue, times the actual share and protection factor established which are caused by natural occurrences in market prices and yields in the pooled production by region. Please note it does not insure for losses against:
Death of dairy cattle;
Other loss or destruction of your dairy cattle; or
Any other loss or damage of any kind whatsoever.
To purchase a policy it can only be done through an authorized crop insurance agent with a completed application at any time. However, insurance does not attach until you buy a quarterly coverage endorsement. Multiple quarterly coverage endorsements are available to purchase with one application. Coverage will start the day you buy the quarterly coverage endorsement.
For More Information
USDA has developed a web-based fact sheet to help understand the basic parameters of the program along with a link providing a list of crop/commodity insurance agents available under the Agent Locator Page. To access the information, view the online fact sheet.
Source: Tracey Erickson, iGrow