This bill updates the Dairy Margin Coverage (DMC) program. (The DMC program was enacted in the 2018 farm bill to support dairy operations by allowing producers to buy a guaranteed margin for their milk production. The margin is the difference between the Department of Agriculture's [USDA's] national all milk price and a calculated feed cost, which provides producers optional risk protection on price and feed costs.)
The bill requires that a dairy operation's production history for DMC be based on the most recent three-year history and be recalculated every five years. (A participating dairy producer must have an established milk production history with USDA's Farm Service Agency.)
The bill also increases Tier 1 margin coverage for annual milk production to 6 million pounds or less (currently 5 million pounds or less) and Tier 2 margin coverage to over 6 million pounds (currently over 5 million pounds).
