Dairy Margin Coverage Will Remain Closed

help for Milk Producers 041720
Address to Farmers, 20Mar2020 ( Sonny Perdue, USDA )

Several dairy producers have been forced to dump milk due to lack of demand from restaurants and schools and processor capacity.

Dairy groups submitted a proposal to the USDA calling for it to reopen the Dairy Margin Coverage program. But Secretary of Agriculture Sonny Perdue says that's not in the plans.

“It is essentially an insurance program and the principle of insurance is that you have to have it before you need it. We’re looking for other ways to indemnify dairymen. I think we will really destroy the whole concept of crop insurance and dairy margin coverage if we allow people to take advantage after the fact. We don’t want to incentivize people to wait and not take out insurance again and then call upon congress and their members in order to have an ad hoc disaster program,” Perdue said. 

 Sign up for this year's program was down 19% from 2019.

Comments
Submitted by 'Ole Macdonald on Wed, 05/06/2020 - 20:45

.....after 5 years of being beaten up by the market many had accumulated a lot of needs for their money, and when market analysts predicted dairy prices well above margins for 2020, it seemed safe to pass on the insurance that was protection from cyclical milk price lows....the corona train wreck is of epic melt down of our dairy markets, and yes, Sonny, you are right, in the normal sense "you can't buy insurance after you need it, but under such extraordinary circumstances you should do the "right thing", stop being vindictively insensitive, and reopen DMC to prevent certain financial ruin for all those without coverage....