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U.S. dairy farmers get assistance to protect margin

Staff Writer |
Registration has opened in the U.S. for dairy farmers to enrol for 2017, the third year of its Margin Protection Programme (MPP), which guarantees a margin over feed costs for milk sold.

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MPP will pay dairy producers the difference between the milk price and feed costs if that margin falls short of the selected margin selected by the farmer. Dairy farmers can insure the margin on a sliding scale between $4 and $8 per 100 pounds (7.94c/l to 15.88 c/l) on as much as 90% of their previous year’s production.

It costs just $100 to register for this scheme and there is no additional cost for $4 protection, but the cost rises incrementally up to $1.36/100 pounds (2.7c/l) for producers covering more than four million pounds (1.76m litres).

Jim Mulhern, president and CEO of National Milk Producers Federation, said: “The poor margins in the first half of 2016 demonstrate the MPP can play an important role in helping America’s dairy farmers manage their financial risks.”

Fifty-four percent of America’s 43,000 dairy farmers, representing 80% of the country’s milk supply, are covered by this scheme.

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