Executive Summary

Dairy Revenue Protection (Dairy-RP) participation figures provided by the USDA Risk Management Agency (RMA) were recently updated with values spanning through the first week of November. Highlights from the most recent report include:

• There were 3,756 Dairy-RP policies sold with active endorsements through the week ending Nov 8^th, up 60 from the previous week. Wisconsin led all states in the number of policies sold with active endorsements, followed by Minnesota, California and Michigan.
• Dairy-RP policies sold through the week ending Nov 8^th have covered a total of 50.95 billion pounds of milk, the equivalent of 11.6% of total 2019-2020 USDA projected milk production volumes. 93.6% of all milk covered has been at the 95% coverage level. Wisconsin has led all states in pounds of milk production covered within the Dairy-RP program through the week ending Nov 8^th, followed by California, Idaho and Minnesota.
• CME Class III Milk volume and open interest figures increased substantially following the initial wave of Dairy-RP sign-ups. CME Class III Milk volume figures trended back towards levels experienced prior to Dairy-RP sign-ups until increasing to a 33 month high level during the third week of September and the second highest level experienced throughout the same period during the week ending Nov 1^st. Class III Milk open interest figures declined to a nine year low during the first week of August, prior to rebounding over more recent weeks of data.

Additional Report Details

Policies Sold:

There were 3,756 Dairy-RP policies sold with active endorsements through the week ending Nov 8^th, up 60 from the previous week. The increase in Dairy-RP endorsements was the largest experienced throughout the past seven weeks.

Dairy-RP policies have been sold throughout 45 states through the week ending Nov 8^th. Policies with active endorsements have been sold throughout 40 states, led by Wisconsin, Minnesota, California and Michigan. Wisconsin has accounted for nearly one third of all policies sold with active endorsements through the week ending Nov 8^th.

Pounds Covered:

Approximately 50.95 billion pounds of milk have been covered through the Dairy-RP program through the week ending Nov 8^th, which is the equivalent of 254,800 Class III milk contracts. 93.6% of all milk production covered has been at the 95% coverage level through the week ending Nov 8^th.

Wisconsin has led all states in pounds of milk production covered within the Dairy-RP program through the week ending Nov 8^th, followed by California, Idaho and Minnesota. The aforementioned states combined to account for over one half of all pounds of milk production covered within the Dairy-RP program.

CME Volume & Open Interest:

CME Class III Milk volume and open interest figures increased substantially following the initial wave of Dairy-RP sign-ups. Class III Milk volumes reached a 22 month high during Oct ’18 while Class III Milk open interest reached a 19 month high during Feb ’19. CME Class III Milk volume figures trended back towards levels experienced prior to Dairy-RP sign-ups until increasing to a 33 month high level during the third week of September and the second highest level experienced throughout the same period during the week ending Nov 1^st. Class III Milk open interest figures declined to a nine year low during the first week of August, prior to rebounding over more recent weeks of data.

Dairy-RP milk production volumes covered through the week ending Nov 8^th were equivalent to 11.6% of total 2019-2020 USDA projected milk production volumes. For comparison, CME Class III Milk open interest as of the week ending Nov 8^th was equivalent to just 1.0% of total 2019-2020 projected production volumes.