Dairy farmers have a new opportunity to protect their farm income with dairy margin insurance. The dairy safety net in the new farm bill takes a new approach.

Margin insurance, and the nuts-and-bolts decisions to be made, will be explained by Joe Horner, dairy economist, University of Missouri Extension.

Horner will speak at five Missouri Dairy Profit Seminars held across the state, Feb. 24-28. They are conducted by the Missouri Dairy Association and University of Missouri.

The new law will replace MILC (Milk Income Loss Contract), which was renewed until Sept. 1 or until the new program is ready. Sign-up at local USDA Farm Service Agency offices is expected in July or August.

The new law provides margin insurance much like crop coverage, Horner says. It's part of the nearly 1,000-page Agricultural Act of 2014.

A low margin between national feed cost and milk price triggers payments.

Producers first decide to sign up for the five-year plan. Annually they choose how high a margin to protect and what percent of production to insure, Horner says.

This involves knowing how much risk the farm can assume. Insurance cost will also affect decisions for each farm.

"There will be an initial learning curve," Horner says. "Producers may have to study it a couple of times." Then there will be annual decisions based on their own expected margins.

Farmers who know their own feed costs will have a better idea of the margins they will insure.

"The farm bill provides attractive insurance rates for dairy producers," Horner says.

"The program favors producers marketing less than 4 million pounds of milk per year. That's about a 200-cow herd," he says. Most Missouri producers can benefit.

"It's a change, but it is not that complicated," Horner says.

"Unless you are philosophically opposed to government programs, it will probably pay to participate. In fact, it's a no-brainer to take the $4 per hundredweight free insurance."

"You do have to make that decision and sign up," he adds.

Dates, locations and reservation contacts:

  • Feb. 24, Sedalia, Mo., Pork Palace, Missouri State Fairgrounds. Pettis County Extension Center, 660-827-0591.
  • Feb. 25, Springfield (Mo.) Livestock Marketing Center off I-44. Tony Rickard, 417-847-3161.
  • Feb. 26, Mountain Grove, Mo., Missouri State University Fruit Experiment Station. Ted Probert, 417-741-6134.
  • Feb. 27, Jackson, Mo., Cape Girardeau County Extension Center, 684 W. Jackson Trail, 573-243-3581.
  • Feb. 28, Union, Mo., Hagie's Nineteen restaurant, 618 N. Washington Ave. Ken Bolte, 636-583-5141.


Horner is one of four speakers at the profit seminars. Others include Mike Hutjens, from the University of Illinois. He speaks twice. Joe Zulovich, MU agriculture engineer, talks on cow comfort. Scott Poock, MU Extension veterinarian, speaks on "Bovine Healthcare."

Advance registration is required. A lunch fee will be charged on arrival for the 9:30 a.m. start. Program ends at 3:30 p.m. Call the phone number listed above for the location you plan to attend.

For more information, go to www.missouridairy.org.
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2.12.2014