Emergency payments from the USDA — just in time for Christmas and the New Year

Just yesterday, the USDA announced that the Dairy Economic Loss Assistance Payment (DELAP) program is now being implemented. The 2010 Agricultural Appropriations Bill authorized $290 million for loss assistance payments to eligible dairy producers. Our local FSA office says that those in Washington hope local offices can begin distributing money early next week — just in time for Christmas. Dairy Producers who have production records on file with the USDA Farm Service Agency (FSA) and are eligible to receive payments will not need to apply for the program.

We now know more about how the money will be divided, too. FSA will use milk production information from February to July of 2009 (six months) and multiply that number by two, with a maximum of 6 million pounds per dairy operation, roughly the milk from 300 cows. The $290 million will then be divided equally per cwt. The estimated rate is about $0.32 per cwt. As an example, if a dairy farm produced the maximum allowable milk production of 6 million pounds and the payment rate is $0.32 per cwt, the dairy operation would receive $19,200. Like MILC payments, those with an annual adjusted nonfarm income of $500,000 or more will not be eligible.

We’d like to thank the University of Wisconsin-Madison Department of Agricultural and Applied Economics for sharing this simple question and answer sheet that is posted below (.pdf format). In this document you will find answers to many other questions you might have regarding these emergency payments.

DELAP Question and Answer pdf.