The Dairy Margin Coverage Program (DMC) is a federal safety net program for dairy producers administered by USDA-FSA. The One Big Beautiful Bill Act (OBBBA) reinstated DMC for 2026-2031. Secretary Rollins announced on Tuesday, January 13, that the 2026 enrollment period has now opened and will close on February 26, 2026. Producers can enroll with their local FSA office and are encouraged to call ahead to schedule an appointment and confirm the required paperwork.
The DMC program protects dairy producers from declines in the milk price and increases in feed prices. It is based on a national margin, the Actual Dairy Production Margin, which is calculated monthly as the difference between the all-milk price and a representative feed cost, which includes corn, soybean meal, and premium alfalfa hay.
At sign-up, producers will be required to (1) pay a $100 fee with additional premiums payable later in the year, (2) select a coverage level, ranging from $4.00/cwt to $9.50/cwt, and (3) establish a milk production history and determine the percentage of milk to cover. The coverage level selection will determine any additional premiums and serve as the basis for any payments. The associated premiums for the coverage level selections are shown in the table below. You will also need to establish production history and determine the percentage of milk to cover, ranging from 5%-95% of your production. All dairy operations will need to establish a new production history for 2026, which is based on the highest milk marketings from 2021, 2022, or 2023 for farms operating prior to January 1, 2023. For farms starting after January 1, 2023, the first year of milk marketing will be used to establish a production history.
The OBBBA increased Tier 1 allowance to 6 million pounds of milk. Previously, 5 million pounds of milk could be covered under the lower Tier 1 premiums. Any milk covered above 6 million pounds will be covered under Tier 2 premiums. Additionally, with the new OBBBA legislation, you may enroll in the 6-year program duration (2026-2031) and receive a 25% discount on annual premiums; however, you will need to make a one-time decision regarding coverage level.