It didn’t take long for USDA’s Risk Management Agency (RMA) to get the Dairy Revenue Protection (Dairy-RP) program back up and running. RMA began posting quarterly premiums and endorsement cost estimates on Jan. 28, the first full day after the partial
Natzke dave
Editor / Progressive Dairy
government shutdown ended. With that information, firms offering Dairy-RP policies can resume selling quarterly endorsements.

Producers seeking Dairy-RP coverage can purchase endorsements through certified sales outlets (crop insurance, brokers and others) up to five quarters into the future. Near term, Dairy-RP sales covering milk revenue for the second quarter (April-June) of 2019 close on March 15; sales covering milk revenue for the third quarter (July-September) of 2019 close on June 15.

Endorsements are also now available through the first two quarters of 2020.

Dairy-RP policies are not available for sale on days following USDA dairy reports with a potential impact on markets, or following days when Chicago Mercantile Exchange (CME) markets move up or down contract limits. Producers can also participate in Dairy-RP, independent of all other dairy risk management programs.


There had been no Dairy-RP sales activity since the government shutdown in late December. As of Jan. 27, dairy producers have covered revenue on about 11.8 billion pounds of 2019 milk production under the program. Based on the latest USDA milk production forecast of 220.9 billion pounds in 2019, the percentage of milk covered under Dairy-RP would be about 5.3 percent.

The latest report shows 1,737 dairy producers had filed applications in 35 states. Of the applications, 870 have purchased 2,274 quarterly endorsements.

Total premium costs on purchased endorsements were about $37.1 million, with USDA RMA subsidies covering about $15.3 million of that.

Dairy-RP is designed to insure against unexpected declines in the quarterly revenue from milk sales relative to a guaranteed coverage level. The expected revenue is based on futures prices for milk and dairy commodities and the amount of covered milk production elected by the dairy producer. The covered milk production is indexed to the state or region where the dairy producer is located. More information is available on the RMA website.  end mark

Dave Natzke