Seemingly in a race to the top, record-high milk prices surpassed record-high feed costs in March to help buffer dairy producer milk income margins calculated under the
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Editor / Progressive Dairy
Dairy Margin Coverage (DMC) program.

The USDA released its latest Ag Prices report on April 29, including factors used to calculate March DMC margins and potential indemnity payments. The March DMC margin is $11.55 per hundredweight (cwt), above the top Tier I insurable level of $9.50 per cwt (Table 1). The March 2022 DMC margin is 58 cents more than February‘s margin and a 16-month high.

DMC payments

Milk price sets new high

The March 2022 announced U.S. average milk price rose $1.20 from February to $25.90 per cwt, a new record high. The average all-milk price previously topped $25 per cwt only three times: in March, April and September of 2014.

milk prices

March milk prices were higher than the month before in all 24 major dairy states (Table 2), topping $26 per cwt in 12 of them.

Largest month-to-month increases were in the Upper Midwest: Minnesota (up $2), Iowa (up $1.80) and South Dakota (up $1.40).


The highest prices were in Florida and Georgia at $28.40 and $27.90 per cwt, respectively. New Mexico was the only state where the March average price was less than $24 per cwt.

Compared to a year earlier, March 2022’s U.S. average milk price was up $8.60 per cwt. Year-over-year prices were up $9 per cwt or more in Arizona, California, Texas and Washington.

DMC margin calculations

All feed prices jump

Offsetting part of the increase in the average milk price were skyrocketing average costs for alfalfa hay, corn and soybean meal (Table 3).

  • The average price for corn rose another 46 cents from January to $6.56 per bushel, the highest on record since the inception of the DMC program or its predecessor, the Margin Protection Program for Dairy (MPP-Dairy).

  • The average cost of soybean meal hit $493.98 per ton, the highest since September 2014. (The USDA’s Agricultural Marketing Service no longer reports monthly average soybean meal prices used in DMC calculations, so the average is based on weekly averages during the month.)

  • With the DMC change to include the price of dairy-quality alfalfa hay in feed cost calculations, the March average price was $269 per ton, up $3 from February and also the highest on record.

March feedstuff prices yielded an average DMC total feed cost of $14.35 per cwt of milk sold, up 63 cents from February and the highest during the DMC or MPP-Dairy era dating back to March 2014.  end mark