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 April. Highlights from the most recent report include:
- There were 3,180 Dairy-RP policies sold through the week ending Apr 5th, with 1,992 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 Apr 5th have covered a total of 22.01 billion pounds of milk, the equivalent of approximately 110,000 Class III milk contracts and 10.0% of total 2019 USDA projected milk production volumes. 93% 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 Apr 5th, 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. 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. Class III Milk open interest declined to a six month low during the week ending Apr 5th, however.
Additional Report Details6
Policies Sold:
There were 3,180 Dairy-RP policies sold through the week ending Apr 5th, up 67 from the previous week. Of the policies sold, 1,992 had active endorsements through the week ending Apr 5th, up 52 from the previous week.
Dairy-RP policies have been sold throughout 41 states through the week ending Apr 5th. Policies with active endorsements have been sold throughout 37 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 Apr 5th.
Pounds Covered:
Approximately 22.01 billion pounds of milk have been covered through the Dairy-RP program through the week ending Apr 5th, which is the equivalent of approximately 110,000 Class III milk contracts. 93% of all milk production covered has been at the 95% coverage level through the week ending Apr 5th.
Wisconsin has led all states in pounds of milk production covered within the Dairy-RP program through the week ending Apr 5th, followed by California, Idaho 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. Class III Milk open interest declined to a six month low during the week ending Apr 5th, however.
Dairy-RP milk production volumes covered through the week ending Apr 5th are equivalent to 10.0% of total 2019 USDA projected milk production volumes. For comparison, CME Class III Milk open interest as of the week ending Apr 5th was equivalent to 2.0% of 2019 projected production volumes.