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Dairy Facts 2016

President’s Budget Expands Dairy Margin Insurance, Excludes Supply Control

Apr 17, 2013

The budget presented last week by President Barack Obama included welcome news for dairy producers and processors alike. It recommended a significant increase in funding for the Livestock Gross Margin for Dairy program, a risk management initiative that allows producers to purchase insurance coverage to protect their profitability. The budget did not include any recommendations to limit milk production or to link production limits to the insurance program.

“The administration has proposed a great idea to expand risk management tools for dairy producers, one that IDFA has been supporting for nearly two years,” said Ruth Saunders, IDFA vice president of policy and legislative affairs. “Another great idea would be to allow for a subsidized margin protection program without mandating that producers also participate in the controversial ‘growth management’ program that the National Milk Producers Federation proposes under the Dairy Security Act.” 

Federal support for livestock insurance products, including dairy gross margin insurance, is currently capped at $20 million per year. The administration’s proposal would provide an additional $100 million per year to support the dairy gross margin insurance program through the federal crop insurance program. Current USDA spending on all crop insurance programs exceeded $16 billion in 2012.

In the dairy proposal, the administration acknowledged that other commodity crops are experiencing record prices while dairy producers continue to be squeezed by rising feed costs.

For more information, contact Saunders at

Dairy Delivers