A new web-based tool is available to help dairy farmers evaluate various scenarios using different coverage levels through the new Dairy Margin Coverage (DMC) program.

The 2018 Farm Bill authorized DMC, a voluntary risk management program that offers financial protection to dairy farmers when the margin between the all milk price and the average feed cost falls below a certain dollar amount selected by the farmer. It replaces the program previously known as the Margin Protection Program for Dairy.

Sign up for this U.S. Department of Agriculture (USDA) Farm Service Agency (FSA) program opens June 17.

“With sign up for the DMC program just weeks away, we encourage producers to use this new support tool to help make decisions on participation in the program,” U.S. Secretary of Agriculture Sonny Perdue said. “Dairy producers have faced tough challenges over the years, but the DMC program should help producers better weather the ups and downs in the industry.”

The University of Wisconsin launched the decision support tool in cooperation with FSA and funded through a cooperative agreement with the USDA Office of the Chief Economist.

The tool was designed to help farmers determine the level of coverage under a variety of conditions that will provide them with the strongest financial safety net. It allows farmers to simplify their coverage level selection by combining operation data and other key variables to calculate coverage needs based on price projections.

The decision tool assists farmers with calculating total premiums costs and administrative fees associated with participation in DMC. It also forecasts payments that will be made during the coverage year.

“The new Dairy Margin Coverage program offers very appealing options for all dairy farmers to reduce their net income risk due to volatility in milk or feed prices,” said Dr. Mark Stephenson, director of Dairy Policy Analysis at the University of Wisconsin, Madison. “Higher coverage levels, monthly payments and more flexible production coverage options are especially helpful for the sizable majority of farms who can cover much of their milk production with the new five million pound maximum for Tier 1 premiums. This program deserves the careful consideration of all dairy farmers.”

For more information, access the tool at fsa.usda.gov/dmc-tool.

For DMC sign up, eligibility and related program information, visit fsa.usda.gov or contact your local USDA Service Center.

To locate your local FSA office, visit farmers.gov/service-locator.