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Dairy Revenue Protection

Dairy Revenue Protection (DRP) is a new tool that helps provide dairy producers protection from a decline in quarterly revenue from milk sales. DRP strictly covers milk prices and does not use a feed cost or margin of profit like other products. DRP is also much more customizable than other dairy coverages.

With DRP there are 5 things to decide….
Pricing Options
•To insure class III or class IV milk or a combination of the two.
•To insure based on component pricing for butterfat, protein and other solids.
Coverage Levels
•Choose between 70%-95% coverage in 5% increments
Amount Of Milk To Cover
•Farmers can choose to insure up to 100% of their milk, but do not have to insure all their milk.
•Farmers can participate in the FSA program DMP and DRP at the same time.
•You can participate in LGM and DRP but not at the same time. If you have an LGM marketing purchased, you cannot purchase DRP in that quarter.
Quarters To Cover
•There are 5 quarterly insurance sales periods you can cover at a time.
Protection Factor
• You can choose a production factor between 1 – 1.5 in .05 increments. This factor increases the amount of a payable claim. It does not increase your probability of a payable claim.

DRP can be purchased daily when RMA validates the prices. Sales are available from 4:00 pm until 9:00 am the following day. If you think this would be a tool that would help your operation, please talk to your agent.