Dairy Farmers Encouraged To Manage Risk

Pennsylvania Agriculture Secretary Russell Redding is encouraging Pennsylvania dairy farmers to take advantage of federal risk-management protection by enrolling in USDA’s Dairy Margin Coverage Program for 2023.

The USDA Farm Service Agency financial safety net pays dairy farmers when the difference between the price for milk and average feed price – the margin – falls below the amount selected by the producer at enrollment.

“Protecting your bottom line against price fluctuations you can’t control just makes sense.” Redding said. “Dairy Margin Coverage is a smart part of every dairy producer’s risk management strategy.”

Dairy Margin Coverage was created under the 2018 federal Farm Bill. Payments to dairy farmers nationwide in 2021 were expected to be nearly $1.9 billion.

In Pennsylvania, 1,711 dairy operations, about a third of Pennsylvania dairy farms, were enrolled in the program. In 2021, these operations received $88,861,920 in payments averaging $51,936 per farm.

To receive coverage in 2023, producers must enroll in the program from Oct. 17 through Dec. 9, 2022.

Find Dairy Margin Coverage program information on the USDA Farm Service Agency (FSA) website, fsa.usda.gov. PA dairy producers should visit their county FSA office by Dec. 9, 2022.

Learn how four Pennsylvania dairy producers of varying sizes fit Dairy Margin Coverage into their risk management strategies, and connect with a risk management consultant through the PA Center for Dairy Excellence.

The Pennsylvania Department of Agriculture supports the Center for Dairy Excellence as part of its mission to feed the success of Pennsylvania’s dairy industry.

Find funding and other resources to support financial planning for agricultural operations, as well as more than 2,000 PA Farm Bill grant recipients, at agriculture.pa.gov/farmbill.