News

Weak first-quarter 2018 milk prices applied downward pressure on prices paid for dairy replacement cows, but foreign demand for U.S. dairy heifers remains strong.

Digest Highlights: From a price formula change proposal and EU-Mexico trade agreement restrictions to school milk and FDA labeling oversight, find a summary of news affecting dairy farmers here.

Editor’s note:  Estimated monthly MPP-Dairy indemnity payments have been adjusted from the original article to account for federal budget sequestration deductions. 

Dairy farmers who enroll in the 2018 Margin Protection Program for Dairy (MPP-Dairy) and elect $7, $7.50 or $8 per hundredweight (cwt) margin coverage are guaranteed indemnity payments for February and March. And, based on the two-month indemnity payment estimates, producers who can stick to Tier I premium payments at the $8 margin level will cover full-year program costs in February-March alone.

Although the spring flush is moving north and regional milk processing capacity is again becoming a challenge, the number of U.S. plants manufacturing one or more dairy products (excluding fluid milk) is actually at a two-decade high.

While the Margin Protection Program for Dairy (MPP-Dairy) has been getting most of the publicity, the recent improvement in milk futures prices is pulling the Livestock Gross Margin for Dairy (LGM-Dairy) program back into risk management strategies for larger producers.