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 third week of February. Highlights from the most recent report include:

• There were 2,338 Dairy-RP policies sold through the week ending Feb 22^nd, with 1,326 of the policies having active endorsements. Wisconsin led all states in the number of policies sold with active endorsements, followed by Minnesota, Michigan and Pennsylvania.
• Dairy-RP policies sold through the week ending Feb 22^nd have covered a total of 17.04 billion pounds of milk, the equivalent of approximately 85,200 Class III milk contracts and 7.7% of total 2019 USDA projected milk production volumes. 91% 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 Feb 22^nd, followed by Idaho, California and Minnesota.
• 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.

Additional Report Details

Policies Sold:

There were 2,338 Dairy-RP policies sold through the week ending Feb 22^nd, up 116 from the previous week. Of the policies sold, 1,326 had active endorsements through the week ending Feb 22^nd, up 75 from the previous week.

Dairy-RP policies have been sold throughout 35 states through the week ending Feb 22^nd. Policies with active endorsements have been sold throughout 34 states, led by Wisconsin, Minnesota, Michigan and Pennsylvania. Wisconsin has accounted for over a third of all policies sold with active endorsements through the week ending Feb 22^nd.

Pounds Covered:

Approximately 17.04 billion pounds of milk have been covered through the Dairy-RP program through the week ending Feb 22^nd, which is the equivalent of approximately 85,200 Class III milk contracts. 91% of all milk production covered has been at the 95% coverage level through the week ending Feb 22^nd.

Wisconsin has led all states in pounds of milk production covered within the Dairy-RP program through the week ending Feb 22^nd, followed by Idaho, California and Minnesota. The aforementioned states combined to account for nearly 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.

Dairy-RP milk production volumes covered through the week ending Feb 22^nd are equivalent to 7.7% of total 2019 USDA projected milk production volumes. For comparison, CME Class III Milk open interest as of the week ending Feb 22^nd was equivalent to 2.8% of 2019 projected production volumes.