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 end of Jun ’21. Highlights from the most recent report include:

• There were 8,560 Dairy-RP policies sold with active endorsements through the week ending Jul 2^nd, up 17 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 Jul 2^nd have covered a total of 147.2 billion pounds of milk, the equivalent of 22.0% of total 2019-2021 USDA projected milk production volumes. 94.2% of all milk covered has been at the 95% coverage level. California led all states in pounds of milk production covered within the Dairy-RP program through the week ending Jul 2^nd followed by Wisconsin, Texas and Idaho.
• 12-month rolling average Class III Milk volume figures reached a record high level during Jan ’21, prior to declining to a 15 month low level during the week ending Jul 2^nd. 12-month rolling average Class III Milk open interest figures remained above the record low levels experienced throughout Mar ’20, finishing near recently experienced 18 month high levels during the week ending Jul 2^nd.

Additional Report Details

Policies Sold:

There were 8,560 Dairy-RP policies sold with active endorsements through the week ending Jul 2^nd, up 17 from the previous week. The weekly increase in Dairy-RP endorsements finished below previous year seasonal levels for the 16^th time in the past 17 weeks.

Dairy-RP policies have been sold throughout 46 states through the week ending Jul 2^nd. Policies with active endorsements have been sold throughout 45 states, led by Wisconsin, Minnesota, California and Michigan. Wisconsin has accounted for over a quarter of all policies sold with active endorsements through the week ending Jul 2^nd.

Pounds Covered:

Approximately 147.2 billion pounds of milk have been covered through the Dairy-RP program through the week ending Jul 2^nd, which is the equivalent of 735,900 Class III milk contracts. 94.2% of all milk production covered has been at the 95% coverage level through the week ending Jul 2^nd.

California led all states in pounds of milk production covered within the Dairy-RP program through the week ending Jul 2^nd, followed by Wisconsin, Texas and Idaho. The aforementioned states combined to account for over 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. More recently, 12-month rolling average Class III Milk volume figures reached a record high level during Jan ’21, prior to declining over the five most recent months of data and returning to a 15 month low level during the week ending Jul 2^nd. 12-month rolling average Class III Milk open interest figures remained above the record low levels experienced throughout Mar ’20, finishing near recently experienced 18 month high levels during the week ending Jul 2^nd.

Dairy-RP milk production volumes covered through the week ending Jul 2^nd were equivalent to 22.0% of total 2019-2021 USDA projected milk production volumes. For comparison, CME Class III Milk open interest as of the week ending Jul 2^nd was equivalent to just 0.7% of total 2019-2021 projected production volumes.