USDA changes weekend Dairy Revenue Protection sign-ups
The volatility of milk prices has brought a change to the Dairy Revenue Protection Program signup process.
USDA says starting Friday, the sales period over weekends for DRP coverage will start by 4:30 pm central time Friday, and then signed endorsements must be submitted by 9:00 am Sunday morning instead of Monday.
Mike North with Commodity Risk Management Group tells Brownfield the volatility of the markets brought the change. “If you go back to April, there were several days when our overnight would begin trading limit up or down.”
North says instead of having all weekend to submit endorsements, agents will have to lock in coverage by Sunday or wait until after Monday’s trade. “Think of it this way. If I’m an insurance company and the market is limit down on Sunday night but I have to honor your pricing from Friday afternoon, how do I manage that?”
From the dairy farmer’s perspective, North says, “I wouldn’t say it’s good or bad. It just changes it.” North says the new USDA rule only changes which days of the weekend the agents are working.
Mike North with Commodity Risk Management Group and Vault Dairy explains USDA’s weekend DRP rule change.