USDA launches program to assist US dairy farmers bounce back from pandemic losses

US – The U.S. Department of Agriculture (USDA) has unveiled a new program aimed at providing additional pandemic assistance for dairy farmers whose livelihoods were adversely affected by covid-19 related disruptions.  

Through the program, USDA will provide about US$350m in pandemic assistance payments to dairy farmers who received a lower value for their products due to Covid-19 related market abnormalities.  

The assistance is part of a larger package amounting to US$6bn of pandemic assistance the USDA announced in March to address gaps and disparities in previous rounds of assistance.   

“The Pandemic Market Volatility Assistance Program is another component of our ongoing effort to get aid to producers who have been left behind and build on our progress towards economic recovery,” said Agriculture Secretary Tom Vilsack. 

This targeted assistance is the first step in USDA’s comprehensive approach that will total over $2bn to help the dairy industry recover from the pandemic and be more resilient to future challenges for generations to come.” 

USDA will make payments through agreements with independent handlers and cooperatives who will then distribute the monies to their dairy farmer suppliers. 

Under the Pandemic Market Volatility Assistance Program, payments will reimburse qualified dairy farmers for 80% of the revenue difference per month based on an annual production of up to 5m pounds of milk. 

Commenting on the government initiative, Senate Appropriations Committee Chairman Leahy Senator Patrick Leahy said, “This will help to make up for losses suffered by these family farms due to the pandemic and together with the positive adjustments to the Dairy Margin Coverage Program will be good news for farmers go into the fall.”  

Other pandemic assistance to dairy farmers includes US$400m for a new Dairy Donation Program to address food insecurity and mitigate food waste and loss; and US$580m for Supplemental Dairy Margin Coverage for small and medium farms.  

Outside the pandemic assistance, USDA will also make improvements to the Dairy Margin Coverage safety net program, updating the feed cost formula to better reflect the actual cost dairy farmers pay for high quality alfalfa.  

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This change will be retroactive to January 2020 and is expected to provide additional retroactive payments of about US$100m for 2020 and 2021.  

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