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U.S. to introduce dairy revenue protection

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Staff Writer | August 21, 2018
dairy farmers
America   U.S. dairy farmers currently have access to a Margin Protection Programme

A collaboration of U.S. organisations lead by the American Farm Bureau Insurance Services are introducing a new insurance product for American dairy farmers, called Dairy Revenue Protection (DRP), on 9 October 2018.

The DRP provides farmers with insurance for the difference between the revenue guarantee and the actual milk revenue, if prices or revenues decline, AHDB reported.

The product is an area-based scheme allowing farmers to take quarterly coverage between 70 and 95% of revenue, which is sold daily. Farmers can take protection in one of two ways. Either by an average of USDA’s prices for Class 3 and 4 milk or based on constituents.

U.S. dairy farmers currently have access to a Margin Protection Programme (MPP) and can use the new revenue protection alongside this, giving them more options around risk management. The MPP protects against declines in a national average income over feed cost margin.


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