DMC Enhancements For 2022 Welcomed

FarmFirst Dairy Cooperative applauds the announcement made by the USDA, sharing that enrollment is now open for the Dairy Margin Coverage (DMC) program and will run from Dec. 13, 2021 through Feb. 18, 2022. The program also received some enhanced features to its feed cost formula, providing a better value for participating producers.

“FarmFirst welcomes the sign-up period for the 2022 DMC program, as FarmFirst and our industry partners have worked hard to advocate for valuable improvements to the feed cost calculation,” says John Rettler, dairy farmer from Neosho, Wis. and president of FarmFirst Dairy Cooperative. “The DMC program has continued to see improvements since it was first implemented, thanks to the feedback farmers continue to share on the program. Clearly, the program continues to be a worthwhile investment, as so far, 10 out of 12 months for the year 2021 have seen payments at the $9.50 level.”

As of Dec. 6, USDA data showed more than $1.1 billion in DMC payments are expected to be distributed to dairy producers under the 2021 program. It is anticipated that the remaining two months of the year will also have payments through the DMC program, continuing into the new year.

“FarmFirst encourages dairy farmers to once again enroll in the 2022 Dairy Margin Coverage program, especially with these enhancements made to the program. Simply put, it provides a cost-effective, inexpensive level of catastrophic coverage for dairy farmers,” says Rettler. “We applaud the efforts of Congress and the USDA in making these improvements to this invaluable program, as well as our dairy farm members who have continued to share with us their experience in how the DMC program performs.”

The DMC program in 2022 will use the premium-quality alfalfa price into the DMC feed cost formula, which is an improvement from the current structure that used a 50-50 blend between the premium-quality price and the regular price. Additionally, USDA will make retroactive payments on this premium alfalfa calculation to producers to January 2020. To complement this further, the new Supplemental Dairy Margin Coverage program will enable some producers who are also enrolled in DMC to receive additional payments reflecting increases in their production since 2014 retroactively to January 2021.