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USDA begins sign-up for dairy income loss

Dairy farmers may begin signing up for the Milk Income Loss Contract (MILC) program, one of the new programs authorized in the 2002 farm bill, on Aug. 13, Agriculture Secretary Ann Veneman announced.

The program compensates dairy farmers when domestic milk prices fall below a specified level. Sign-up dates for other new farm bill programs will be announced in coming weeks, the secretary said.

“USDA continues to work aggressively to implement the new farm bill in an efficient and timely manner,” Veneman said while touring dairy operations in New England. “This announcement will allow dairy farmers to begin sign-up so they can obtain program benefits.”

Dairy producers who produced milk in any state and marketed the milk commercially beginning December 2001 may sign up. To be approved for the program, producers must be in compliance with highly erodible and wetland conservation provisions and must enter into a contract with USDA's Commodity Credit Corp. to provide monthly marketing data.

MILC payments will occur in months when the price of Class I milk in Boston under the Northeast Milk Marketing Order falls below $16.94 per hundredweight. Payment rates will be 45 percent of the difference between $16.94 and the Boston Class I price for that month.

Dairy operations will not receive a payment for months during which the Class I price in Boston is $16.94 or higher. A similar payment calculation will be applied from Dec. 1, 2001, through the month preceding the month the producer enters into a contract with CCC.

Program payments, scheduled to begin in October 2002, will be retroactive from Dec. 1, 2001 for eligible production. Payments will be made on an operation-by-operation basis, up to a maximum of 2.4 million pounds of milk produced and marketed by the dairy operation per fiscal year.

Producers can select the month they want to start receiving payments for eligible production.

As required by the 2002 farm bill, USDA will apply the same definition for a dairy operation as used in previous dairy market loss assistance programs.

A dairy operation is any person or group of persons who as a single unit, as determined by CCC, commercially produces and markets cow milk and has production facilities located in the United States. Producers on dairy operations are not permitted to reconstitute a dairy operation for the sole purpose of receiving additional payments.

For more information and requirements, or to sign up for the program, dairy producers should visit their local USDA Farm Service Agency offices or go the USDA Website at:


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