November 3, 2016

Regional Price Calculations One Focus of MPP Changes

 |  By: Anna-Lisa Laca

The margin protection program (MPP) has been a point of frustration for many dairy farmers over the last period of low prices. National Milk Producers Federation (NMPF) is committed to helping fix the program according to NMPF chairman and Missouri dairy farmer Randy Mooney.

What NMPF sent to Congress as the MPP program isn’t the price support farmers have today. “When we put our bill towards Congress the MPP had a different formula for feed,” Mooney says. “When the feed formula was changed it took a dollar per hundredweight off that formula.” He says now the program isn’t nearly as effective as farmers hoped it would be. NMPF has taken note and is working with legislators to fix the broken safety net. “We’ve set up a committee and we hope to get something done with board approval by March and then we’d have something ready to go to Congress any time we have a bill to attach it to,” Mooney says.

Many have thought revisions to the program would have to wait for the next Farm Bill which isn’t until 2018, but farmers say they need a fixed program now. “We need something sooner than the new Farm Bill,” Mooney says. “Farmers are invested in this and they’re seeing their money going into the general revenue of the government and they don’t like it.”

Regional Cost Equations

One area NMPF is focusing on fixing is the cost equation itself. Farmers across the country have complained the current national feed cost figure doesn’t apply to their area and they would like to use a regional cost. Mooney says NMPF is looking into using a regional feed cost adjuster in addition to regional milk prices to make the margins more representative of what farmers are experiencing. “Farmers want to use a regional feed cost,” he says, “but you can’t use a regional feed cost without using regional milk prices.”

Listen to Rick Mooney chat with Mike Adams on AgriTalk below.