America?s dairy farmers face many uncertainties, especially when it comes to fluctuating milk prices. A new program aims to provide certainty to farmers during volatile times.
The American Farm Bureau Federation (AFBF) and American Farm Bureau Insurance Services (AFBIS) and other groups recently created a federal crop insurance program to help America?s dairy farmers. AFBF chief economist John Newton says the product insures the difference between the revenue guarantee and actual milk revenue, when prices or revenues decline, without capping production.
?We recognize that there are dairy farms of all sizes. We wanted to make a program that would work for small, medium and large dairies, so there absolutely is no cap on how much milk you can insure under the Dairy Revenue Protection program,? Newton said.
The product can be used alongside the Margin Protection Program (MPP). Newton discusses how the policies work.
?The farmer who decides to buy for production they expect to produce has to meet those production thresholds set forth in the policy. We don?t need to see that you have plans to move dirt or that you bought cows in order to insure that milk that you expect to come online,? Newton said.
The new product will become available on October 9th. A premium calculator is available to producers who are interested in these policies.
