Dairy Margin 

Coverage Program

The 2018 Farm Bill authorizes the Dairy Margin Coverage 

(DMC) program, which replaces the Margin Protection 

Program for Dairy (MPP-Dairy).

The Further Continuing Appropriations and Other 

Extensions Act, 2024, extended provisions of the 

Agricultural Improvement Act of 2018 (2018 Farm Bill) and 

amends Section 1403 of the Agricultural Act of 2014 (2014 

Farm Bill) authorizing DMC for coverage year 2024 and to 

allow certain eligible dairy operations to make a one-time 

adjustment to established production history.

The DMC program is a voluntary program that provides 

dairy operations with risk management coverage that will 

pay producers when the difference (the margin) between 

the national price of milk and the average cost of feed falls 

below a certain level selected by the program participants.

Who is Eligible?

All dairy operations in the United States are eligible for the 

DMC program. An operation can be run either by a single 

producer or multiple producers who commercially produce 

and market cows’ milk. 

Each producer on the operation must share in the risk of 

producing milk and make contributions (including land, 

labor, management, equipment, or capital) to the operation 

of the dairy that are at least equal to the individual or 

entity’s share of the operation.

An eligible dairy operation must:

• have a production history determined by the USDA 

Farm Service Agency (FSA)

• be registered to participate during a signup announced 

by FSA

• pay a $100 administrative fee annually for each year 

of participation, except if the dairy operation qualifies 

for a waiver for limited resource, beginning, socially 

disadvantaged, or veteran farmers and ranchers

• select a coverage level ranging from $4.00 to $9.50 per 

hundredweight in $0.50 increments

• select a coverage percentage of the dairy operation’s 

production history ranging from 5 percent to 95 

percent, in 5 percent increments

If a dairy is operated by more than one producer, it will be 

registered as a single operation. If producers operate two or 

more dairies, each operation will be registered separately.

Eligible program participants in DMC are also eligible 

to participate in the Livestock Gross Margin for Dairy 

Producers Program and the Dairy Revenue Protection 

Program administered by the Risk Management Agency.

How it Works:

Production History

For most operations, production history is based on the 

highest milk production in 2011, 2012, and 2013. New dairy 

operations may establish a production history from recent 

annual production levels. During the years of 2021, 2022, 

and 2023 dairy operations that increased milk production 

levels over their established production history were 

able to update production history through an established 

supplemental production history. For 2024 DMC, 

participating dairy operations production history of record 

may be a combination of previous established production 

histories. 

MARCH 2024
DAIRY MARGIN COVERAGE - MARCH 2024 2

Administrative and Premium Fees and Premium Fee 

Discount

The DMC program offers:

• catastrophic coverage at no cost, other than an annual 

$100 administrative fee

• greater coverage, at various levels, for a premium in 

addition to a $100 administrative fee

The schedule of premiums is provided in the following table.

Coverage 

Level

Tier 1

Premium per cwt for 

covered production history 

of 5 mil lbs. or less

Tier 2

Premium per cwt, 

all years for covered 

production history 

over 5 mil lbs. 

$4.00 None None

$4.50 $0.0025 $0.0025

$5.00 $0.005 $0.005

$5.50 $0.030 $0.100

$6.00 $0.050 $0.310

$6.50 $0.070 $0.650

$7.00 $0.080 $1.107

$7.50 $0.090 $1.413

$8.00 $0.100 $1.813

$8.50 $0.105 N/A

$9.00 $0.110 N/A

$9.50 $0.150 N/A

USDA is an equal opportunity provider, employer, and lender. fsa.usda.gov

A dairy operation that selects dairy margin coverage above 

the catastrophic level coverage is required to pay, in addition 

to the annual administrative fee, if applicable, an annual 

premium based on the coverage level and percentage of 

production history. A second election on production above 5 

million pounds in Tier II (between $4 and $8) may be chosen 

if $8.50 or above is elected in Tier I.

New dairy operations that first register for the DMC 

program for a calendar year after the start of a calendar year 

can lock-in coverage for the premium discount by paying a 

pro-rated premium. 

A dairy operation that makes a one-time election of 

coverage level and coverage percentage that are applicable 

to each of calendar years 2019 through 2024 will receive a 

25 percent discount on premium rates.

The premium fee discount for a lock-in contract is applicable 

for all pounds of adjusted base production history. 

Adjusted Base Production History

FSA has revised the regulations for DMC to allow eligible 

dairy operations to make a one-time adjustment to 

established production history. 

The adjusted base production history calculation is based 

on actual 2019 marketings for the participating dairy 

operation and applies the same calculation used to establish 

supplemental production history. To be eligible for the 

adjusted base production history, participating dairy 

operations must: 

• have established production history of less than 5 

million pounds

• complete and submit CCC-800B: Adjusted Base 

Production History Establishment during the 2024 

registration and coverage election period

• provide supporting documentation of actual 2019 

marketings

• not have established supplemental production history 

during coverage years 2021, 2022, or 2023.

Note: For dairy operations who established supplemental 

production history during 2021 through 2023 coverage 

years are required to combine their supplemental 

production history with established production history 

to create one adjusted base production history. Once 

combined, the adjusted base production history will be the 

production history of record on the 2024 DMC contract.

0 For More Information

For more information about FSA programs, 

visit fsa.usda.gov or contact your local FSA 

office. To find your local FSA office, visit 

farmers.gov.

This fact sheet is for informational purposes 

only; other eligibility requirements or 

restrictions may apply.