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 22nd, 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 22nd 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 22nd, 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 22nd, up 116 from the previous week. Of the policies sold, 1,326 had active endorsements through the week ending Feb 22nd, up 75 from the previous week.

Dairy-RP policies have been sold throughout 35 states through the week ending Feb 22nd. 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 22nd.

Pounds Covered:

Approximately 17.04 billion pounds of milk have been covered through the Dairy-RP program through the week ending Feb 22nd, 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 22nd.

Wisconsin has led all states in pounds of milk production covered within the Dairy-RP program through the week ending Feb 22nd, 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 22nd 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 22nd was equivalent to 2.8% of 2019 projected production volumes.

2019-02-26T10:39:54+00:00