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Register for dairy margin protection as of July 1st

Program helps farmers cope with fluctuating prices

By Diego Flammini, Farms.com

In an effort to offer farmers protection from ever-changing prices associated with producing dairy products, the United States Department of Agriculture will be accepting enrollments for the Margin Protection Program starting July 1st, 2015.

The program provides dairy producers with financial assistance when the margin (the difference in cost between prices of milk and feed costs) is below the level of coverage they’ve selected.

Cows being milked

More than half of America’s dairy farmers enrolled in the program last year and officials are optimistic about the trend continuing.

"We are confident that dairy farmers across the country will again take advantage of this safety net program for 2016,” said Agriculture Deputy Secretary Krysta Harden. “USDA will continue outreach efforts, including partnering with cooperative extension services, to ensure dairy producers are fully informed about the protections that this safety net program can provide during periods of market downturns."

Enrollment for the 2016 program opens on Wednesday, July 1st, 2015 and goes until Wednesday, September 30th, 2015.

Farmers will be covered until 2018 and only have to pay an annual administration fee of $100. They’ll also be able to change their coverage levels during the enrollment period. Payments are calculated based on the operation’s history of dairy production. If the operation took part in the program in 2015, its production is estimated to increase by 2.61%.

Producers who are currently participating in the Livestock Gross Margin insurance program can register for the Margin Protection Program, but it will only begin after their livestock dairy insurance coverage ends.

Dairy farmers wishing to enroll in the protection program must submit an application form, documenting their coverage levels. If for 2016 a higher level is being selected, producers can pay the premium in full, or at least 25% of it by Monday, February 1st, 2016.

To aid in the process, the USDA has also developed an online tool to help dairy farmers choose their level of coverage. It allows producers to calculate their needs based on price projections.

If you’re looking to expand your dairy operations, be sure to check out the Farms.com dairy cattle classifieds listings.

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