DMC Margin in July Offers What May Be Final Month of Payments in 2019
September 4, 2019
At $9.27 per cwt., the July margin under the Dairy Margin Coverage program came in under the maximum $9.50 per cwt. program coverage level for the seventh, and likely final month in 2019, given current Chicago Mercantile Exchange forecasts.
Absent any additional payments for the final five months of the year, the net payment for the full year to producers signing up at that maximum coverage level for their first five million pounds of covered production history will be $0.36 per cwt., after sequestration reduction and payment of premium. Nine cents of this average payment comes from including dairy-quality alfalfa hay in the DMC feed-cost calculation, a change in policy NMPF pushed for throughout farm bill discussion and implementation.
Producers have until September 20 to enroll in the program for this year.
The changes in the July DMC margin and its components from the month before are shown in the chart on the left. All numbers are per hundredweight of milk and are rounded to the nearest cent.
The DMC information page on NMPF’s website offers a variety of educational resources to help farmers make better use of the program. NMPF also posted a new video last week explaining how farmers can benefit from the DMC.