USDA Reopens Enrollment for Margin Protection Program

Dairy Producers are encouraged to consider enrolling in the new and improved 2018 Margin Protection Program (MPP).  Farm Service Agency (FSA) has set the MPP re-enrollment period to run from April 9, 2018 to June 1, 2018.

Substantial program changes to the MPP for dairy producers were made in the Bipartisan Budget Act of 2018. FSA has implemented these changes to the 2018 MPP and encourages all dairy producers to consider 2018 MPP enrollment. The enrollment is retroactive to January 1, 2018.

Changes include:

  • Payments will be made monthly, rather than bi-monthly
  • Covered production is increased from 4 million to 5 million pounds of milk for Tier 1
  • Premium rates are substantially lowered for Tier 1
  • Producers qualify for an exemption from paying the administrative fee if they are:
    • Limit Resource
    • Beginning Farmer
    • Veteran
    • Disadvantaged

Note:  Producers can participate in the FSA’s MPP-Dairy or the Risk Management Agency’s Livestock Gross Margin Insurance Plan for Dairy Cattle (LGM-Dairy), but not both.  If you are enrolled in the LGM-Dairy program, and have targeted marketings insured in 2018 months, you can enroll in the 2018 MPP  by June 1, 2018, although your coverage will start only after the active target marketings conclude under your LGM-Dairy contract.

Below find a link to a recorded 2018 MPP enrollment webinar by Mark Stephenson, University of Wisconsin, and Andrew Novakovic, Cornell University.  This webinar explains the changes to the MPP and walks you through the use of the Decision Tool.  This tool enables you to try different coverage levels based on your farm’s production history, helping you decide which plan is best for your farm.    For example, by using the Decision Tool, you can see that if your farm ships more than 30 million pounds (about 1,200 cows) then MPP is not a good choice for you in 2018, because your costs will outweigh your indemnity payments received, due to the fact that the coverage costs are high at the Tier 2 level.  However, for smaller farms shipping less than 30 million pounds, the re-enrollment may be a very good choice.  Please take time to use the MPP Decision Tool to help you decide what is best for you.

The webinar was co-sponsored by Farm Credit East.

To help you understand the provisions in the updated program we have resources available (see links below).

If you have any questions, please contact Sarah Grotjan, Dairy/Livestock Educator, UW-Extension Outagamie County at 920-832-5129 or email sarah.grotjan@outagamie.org

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