MPP Forecast: January 2019
December 9, 2018
The monthly margin under the dairy Margin Protection Program (MPP) for October 2018 was $8.96/cwt., $0.70 higher than the September margin. The MPP margin has improved by $2.24/cwt. over the past three months. The October all-milk price was $17.40/cwt., also $0.70 higher than in September. The October MPP feed cost formula was essentially unchanged from a month before. Very minor changes in the three individual MPP feed cost formula components offset each other between September-October. Over the past five months, the MPP feed cost has fallen by $0.98/cwt.
The USDA online MPP Decision Tool was recently updated to show projections for 2019. Based on the Dec. 7 dairy futures settlement prices, the tool indicates that the MPP margin may remain in the $8.00-$9.00/cwt. range during at least the first half of next year.