Washington's New Dairy Policy and the Margin for Success

Ag Banking
12.29.14
In this article, Welles Orr discusses the impact of the Agricultural Act of 2014 on the dairy industry, particularly the Dairy Producer Margin Protection Program (MPP), and its prospects for industry success. MPP, a voluntary program that provides dairy producers with payments when the national milk margin falls below a margin insurance coverage level that producers choose each year, is expected to be put to the test with the grim outlook for milk futures through 2016, Orr said. "If anything the MPP looks to be a better safety net for dairy farmers -- to manage potential catastrophic conditions -- than what they had before in the previous farm bill," he added. "With dairy futures looking weak and milk prices expected to drop next year, slowing exports and an uptick in imports, combined with increases in milk production, the dairy roller coaster rolls along. MPP will hopefully help farmers hang on for the ride."
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