American Farm Bureau Federation and American Farm Bureau Insurance Services, Inc. are seeking approval from USDA to deliver a new insurance product to dairy farmers. The concept is for an area-based revenue protection policy called Dairy-Revenue Protection (Dairy-RP). Your survey responses concerning this policy will be used to inform USDA about the dairy industries risk management needs. (* denotes required field)
How It Works
Dairy-RP would protect against unexpected declines in milk prices or state-level milk production that reduces the revenue on the farm during a quarter. This policy would be in addition to margin insurance and protection programs currently available to dairy farmers from USDA.
Farmers purchasing Dairy-RP would have the option to determine how the value of milk is determined in their policy. The first option would allow a farmer to choose a milk value based on a mix of Class III and Class IV milk futures prices. The second option would allow a farmer to choose a milk value based on their desired butterfat and protein tests. The farmer would then choose how much milk to cover during a quarter and how much protection to buy, from 70 to 95 percent.
Class Price Option Example
Component Option Example