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 June. Highlights from the most recent report include:

• There were 3,894 Dairy-RP policies sold through the week ending Jun 21^st, with 2,478 of the policies having active endorsements. Wisconsin led all states in the number of policies sold with active endorsements, followed by Minnesota and Michigan.
• Dairy-RP policies sold through the week ending Jun 21^st have covered a total of 29.59 billion pounds of milk, the equivalent of approximately 148,000 Class III milk contracts and 13.6% of total 2019 USDA projected milk production volumes. 94% 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 Jun 21^st, 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. CME Class III Milk volume and open interest figures have trended back towards levels experienced prior to Dairy-RP sign-ups over more recent weeks, however.

Additional Report Details

Policies Sold:

There were 3,894 Dairy-RP policies sold through the week ending Jun 21^st, up 17 from the previous week. Of the policies sold, 2,478 had active endorsements through the week ending Jun 21^st, up 33 from the previous week.

Dairy-RP policies have been sold throughout 44 states through the week ending Jun 21^st. Policies with active endorsements have been sold throughout 40 states, led by Wisconsin, Minnesota and Michigan. Wisconsin has accounted for nearly one third of all policies sold with active endorsements through the week ending Jun 21^st.

Pounds Covered:

Approximately 29.59 billion pounds of milk have been covered through the Dairy-RP program through the week ending Jun 21^st, which is the equivalent of 148,000 Class III milk contracts. 94% of all milk production covered has been at the 95% coverage level through the week ending Jun 21^st.

Wisconsin has led all states in pounds of milk production covered within the Dairy-RP program through the week ending Jun 21^st, followed by California, Idaho and Minnesota. The aforementioned states combined to account for nearly 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 and open interest figures have trended back towards levels experienced prior to Dairy-RP sign-ups over more recent weeks, however.

Dairy-RP milk production volumes covered through the week ending Jun 21^st were equivalent to 13.6% of total 2019 USDA projected milk production volumes. For comparison, CME Class III Milk open interest as of the week ending Jun 21^st was equivalent to 2.1% of 2019 projected production volumes.