U.S. to introduce dairy revenue protection
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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. ■