NMPF: Use Dairy Margin Coverage Program to Hedge Price, Political Risk
November 30, 2020
Most forecasts predict milk prices will soften next year. National Milk Producers Federation senior vice president Chris Galen says the Dairy Margin Coverage Program is a compelling tool to hedge against price and political risk in 2021.
“Congress is still trying to pass another stimulus bill to help all walks of life in our society and our economy and hopefully agriculture will be part of that, but right now there aren't any serious negotiations. Who knows if that can will be kicked into 2021?” Galen said in this week’s Dairy Defined podcast from NMPF. “What we do know is that the DMC program is forecast to make payments in the first part of 2021. So, you've got to go with what you know.”
Enrollment for the Dairy Margin Coverage program closes Friday, December 11, 2020. To date, just 6,300 dairy producers have enrolled in the safety net program. In 2020, more than 13,000 of the Nation’s nearly 37,000 dairy producers received more than $470 million dollars in payments.