Source: POLITICO'S MORNING AGRICULTURE, 10/3/19

It's the most money milk producers have seen from a federal insurance program, now called Dairy Margin Coverage, since first being established in the 2014 farm bill — even as thousands exited the business in recent years amid a multiyear slump in milk prices, exacerbated by President Donald Trump's trade wars.

For decades, dairy farmers have told agriculture lawmakers that the federal safety net didn't offer meaningful support, resulting in various policy experiments. DMC is the latest iteration, after Congress in the 2018 farm bill significantly bolstered the program by making it less expensive to participate and changing certain calculations so it's more likely to trigger payments to farmers.

The National Milk Producers Federation, in a new analysis on Wednesday, said that without these changes, DMC only would have paid out $75,000 this year, or about $3 per operation. Subtract the cost of premiums, and farmers would be facing a net loss.

That was the case in 2017, when the government actually earned $27 million from a previous version of DMC, according to CBO.

Turning a corner? The lack of payments led many milk producers to abandon the program, which sends payments when the margin between the cost of milk and feed drops below levels farmers choose to insure. But participation is now on the rise, according to the latest USDA data, with 22,235 farms enrolled — or about 77 percent of all operations across the country. That's up from the previous two years, according to NMPF.

A USDA spokesperson, however, told POLITICO in an email that data from 2018 "is not available at this time" and did not offer an explanation.