Local dairymen eligible to receive income loss money

LaCresha Dale, Executive Director for USDA's Farm Service Agency in Cherokee County has announced due to low milk prices FSA will be making payments in April to producers through the FSA's Milk Income Loss Contract, or MILC, program. The 2008 Farm Bill made changes to the MILC program, most notably the addition of a dairy feed ration cost adjustment in addition to changes to the payment rate and modifications to the per-operation poundage limit, depending on when the milk is produced.

The number of dairies in Cherokee County has dropped considerable in the last few months. Milk producers in the county include Joey Dyess, Kenny Dyess, Michael Tugwell, (Gary) Dominy Farms Inc., David and Susan Jones and Rodney and Cathy Newman. Former dairymen Reda and Forrest Dyess and Mark Welch are still in the ranching business. The decline in the number of dairies has come because of the demands of the economy.

All dairymen are encouraged to make application for these income loss funds.

"We will be making MILC payments as a result of the low prices but because of the changes to the program ordered in the 2008 Farm Bill, the payments may be higher but will take a bit longer to gather the required data before payments can be made," Mr. Dale explained.

FSA makes MILC payments on a monthly basis when the Boston Class I milk price falls below $16.94 per hundredweight (cwt) as adjusted for feed costs. The monthly Boston price is posted online at: http://www. fmmone.com/Northeast_Order_ Prices/NE_Prices_main new.htm#Advance.

FSA determines the per hundredweight payment rate for the applicable month by subtracting the Boston Class I price for that month from the $16.94 MILC payment trigger price as adjusted for feed costs, and multiplying the difference by 45 percent. The payment factor of 45 percent will decline to 34 percent on Sept. 1, 2012.

The MILC payment trigger price of $16.94 is adjusted upward when the National Average Dairy Feed Ration Cost for a month is greater than $7.35 per cwt. This rate will change to $9.50 on Sept. 1, 2012.

The dairy feed ration cost is calculated each month from the price of feed ingredients used to create a 16 percent protein dairy feed as reported by the National Agricultural Statistics Service (NASS).

FSA issues payments not later than 60 calendar days after FSA receives production evidence for the applicable month or the entire month's National Average Dairy Feed Ration Cost is posted for the applicable month, whichever is later.

FSA makes payments on up to the maximum eligible pounds of milk produced and marketed by each operation per fiscal year. The annual maximum eligible pound limit per dairy operation is 2,985,000 pounds per fiscal year. The amount drops to 2.4 million pounds per fiscal year on Sept. 1, 2012.

Producers may contact their local FSA office to sign up for the MILC program.

The 2008 Farm Bill also excludes producers whose non-farm average adjusted gross income (AGI) exceeds $500,000 from receiving MILC payments. Producers will have to sign an AGI statement when signing up for the program. More information about the MILC program can be found on the FSA website http://www.fsa.usda.gov.