Committed to 5-Year-DMC Participation? Don’t Forget to Sign on the Dotted Line

Even if you enrolled your farm in the Dairy Margin Coverage (DMC) program for five years to take advantage of the discounted premiums, you still need to visit your local Farm Service Agency (FSA) office. 

When the DMC began in 2018, farmers were able to sign up for a 5-year period to save on premiums. Just because you’ve done that, Chris Galen of National Milk Producers Federation says there is still paperwork to be done before you’re enrolled. 

“You still have to go down to your county FSA office or at least contact them by the end of next week to fill out the paperwork for the next year, and pay the administrative fee,” he said on the organization’s risk management webinar this week. 

When you committed to participating in the program for five years, you simply locked in your coverage. Each subsequent year producers need to visit their FSA office to certify your milk production and pay the $100 administrative fee that is assessed annually. 

Enrollment for Dairy Margin Coverage program for 2021 ends Friday, Dec. 11, 2020. 

“2020 has been a challenging year for agricultural producers, and we don't know yet what the next year will bring,” says FSA Administrator, Richard Fordyce. “Dairy producers should definitely consider coverage for 2021 as even the slightest drop in the margin can trigger payments.”

The DMC program, created by the 2018 Farm Bill, offers market protection to dairy producers when the difference between the all-milk price and the average feed cost falls below a certain dollar amount selected by the producer.

Farmers can select a $4.00 catastrophic level of coverage with no premium fee or they can choose to buy-up coverage where the premium is based on margin triggers between $4.50 and $9.50 on 5 to 95% of established production history. FSA has a margin calculator tool to help determine what level of coverage your operation needs.

Learn more at Farmers.gov.