USDA recently announced the details of the 2019 Market Facilitation Program designed to help farmers cope with income losses due to the ongoing trade war. Direct payment assistance to dairy farmers was announced at 20 cents per hundredweight, with total payments capped at $250,000 per farm operation or legal entity. John Newton, chief economist of the American Farm bureau Federation, took a look at the numbers to determine which states and counties would receive the most payments.
Dairy farmer payments are based on their Farm Service Agency (FSA) milk production history – a component of the Dairy Margin Coverage (DMC) program.
“Based on FSA DMC enrollment data, total production history in the U.S. represents 185 billion pounds of milk, which suggests that if all three tranches of trade aid payments are made, dairy farmers will receive approximately $351 million to $371 million in benefits – potentially more than double what they received in the first round of trade aid payments in 2018 (Trade Aid Round One: A State Perspective and Mapping $8.5 Billion in Trade Assistance),” Newton wrote in his Market Intel blog post. “If all payments are made, the $351 million to $371 million in dairy-related payments will represent 2.4% to 2.6% of all 2019 Market Facilitation Program payments; in 2018 dairy received 2.1% of all trade assistance dollars.”
Newton’s research found that California will be receiving the most MFP money at $77.8 million, followed by Wisconsin at nearly $50 million. The top five states are estimated to receive $196 million in trade assistance, representing 53% of all dairy-related Market Facilitation Program payments, according to Newton.
Check out the state map below:
Visit the next page to see aid payments broken down by county.