Market expert says many dairy producers have DRP questions

A markets expert says many farmers remain confused about the new Dairy Revenue Protection Program and how to best use it. 

Jenny Wackershauser with Commodity Risk Management Group tells Brownfield the new Dairy Revenue Protection program is not the kind of insurance farmers should sign up for and then forget about.  Wackershauser tells Brownfield someone should be paying attention to the markets. “We have to understand how all of those pieces compare to each other to make the decision on when to get coverage that works best for your operation and not just, oh, I need to sign up (because) we think it’s going to pay out. We want it to ultimately be the tool that helps you put that floor in your milk price.”

She says choosing to insure the milk or the components can be challenging. “Recently, Class III milk has been trading ahead of where the pieces of butter and cheese are. Well, that doesn’t line up because we all know when at the end of a milk month, we settle Class III milk to the components that make it up.”

Her advice to farmers is to work with an agent that understands the markets and regularly communicates with them to get the most value for the insurance premiums being paid.

Wackershauser spoke with Brownfield at the WPS Farm Show in Oshkosh, Wisconsin. Listen to the entire interview here:

Photo: CRMG’s Britt O’Connell (L), Jenny Wackershauser (C) and Verl Prather (R)

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