HighGround Dairy commentary on US Farm Bill

Farm Bill Could Be Considered on House Floor on Wednesday   The House and Senate Ag Conference Committee filed a new Farm Bill late Monday and may be considered on the House floor as early as Wednesday. Both the International Dairy Foods Association and National Milk Producers Federation issued releases on their website yesterday commending the bipartisan compromise. It does not appear either will stand in the way of its passage and the stage is set for new policy for the next five years. Specific to the dairy title, here are a few key takeaways that are included in the compromise legislation: USDA will establish a Margin Protection Program for dairy producers no later than Sep 1, 2014.  The current MILC program will be in place until the new program is launched Producers will have the option to select margin insurance coverage between $4 and $8/cwt of the milk feed price margin.  Premiums for the insurance wll be tiered; with cheaper levels on the first 4 million pounds and more expensive above that level.  Pricing will be tiered; less expensive for the first 4 million pounds of milk and costlier on anything above that amount.   $4.00/cwt base protection will be included with no cost to producers other than a nominal administration fee ($100). Producers will still have the option to participate in the Livestock Gross Margin (LGM) for Dairy program but would then be opting out of the new Margin Protection Program. USDA must establish a “dairy production donation program” to address low margin periods.  After sub-$4.00 milk feed margins are recorded for 2 consecut