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Understanding how the vital components of farming impact an operation is what distinguishes DCIS as an industry leader. Working one-on-one, we develop the most comprehensive risk management plan for every element of a farming operation. To meet our customers’ needs, we currently offer three programs to protect livestock.

Livestock Risk Protection

Protects against declining market prices.
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Livestock Gross Margin

Provides protection against the loss of gross margin.
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Quick Reference Guide

Dairy Revenue Protection

Designed to insure against unexpected declines in the quarterly revenue from milk sales relative to a guaranteed coverage level.
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Dairy Revenue Protection:

The Revenue Protection program allows dairy farmers to purchase risk management protection against declines in quarterly revenue from milk sales. This includes an unexpected decline in milk prices, an unexpected decline in milk production, or an unexpected decline in both milk prices and milk production.

Farmers Simply Select:

  1. How milk is priced –
  2. Coverage level – 70% to 95% of expected (guaranteed) revenue
  3. Quarterly time frame of coverage
  4. Protection Factor
  5. Amount of Milk Production to cover

The revenue guarantee will be based on future milk prices, expected production, and market-implied risk.

Purchasing a Policy The policy will be sold on a daily basis and would insure a quarter of milk production. Policies can be purchased beginning October 9, 2018 for an individual quarter, or several quarters, up to five quarters out. The price of the policy varies daily based on the farmer-selected parameters on the expected risk in the market.

Claims Payments
Once the monthly milk and component prices are announced for the quarter, and USDA’s milk production report identifies the actual milk production per cow for each state, the state-indexed actual revenue will be compared against the revenue guarantee. If the actual revenue is below the guarantee, the farmer is paid a policy indemnity based on the difference. If the state-indexed actual revenue is above the revenue guarantee, the farmer pays only the policy premium.

Subsidy Factors: This policy does include subsidies, if in compliance with Conservation requirements, as shown below:

Coverage Level Subsidy
90 - 95% 44%
85% 49%
75 - 80% 55%
70% 59%

Why Buy This?
This product was developed to help dairy farmers address some of the biggest risks they have in their operations – particularly those associated with the milk price basis and the variability in milk production. This product allows dairy producers to value milk based on the milk components or a mix of Class III and Class IV milk prices, therefore addressing the risk associated with milk prices, the variability in production, and the amount of revenue a cow generate each month. It’s a great alternative to the current Dairy Margin Protection Policy (MPP).

For more information, contact your DCIS Agent or Representative TODAY to sign up for this program.

Examples from the 2019 Dairy RP Policy