USDA has finally announced the new Dairy Economic Loss Assistance Payment (DELAP) program, and an average payment of 32 cents per cwt. is expected. The money comes via a provision in the Fiscal Year (FY) 2010 Agricultural to make $290 million in payments directly to eligible dairy producers.
Here's how the program will be structured, according to USDA:
Eligible producers will receive a one-time direct payment based on the amount of milk both produced and commercially marketed by their operation during the months of February through July 2009. Production information from these months will be used to estimate a full year's production for an operation to calculate the payments, using a 6-million pound per dairy operation limit.
Dairy producers who have production records at the USDA Farm Service Agency (FSA) county office because they participated in another FSA dairy program (such as the Milk Income Loss Contract or MILC program) do not need to apply for the program. FSA will use existing production records for February through July 2009 to calculate and issue their payments.
Producers who have not provided production data for those months to FSA, and have not already been contacted by FSA to provide such data, have 30 days, until Jan. 19, 2010, to apply.
More than 95% of eligible producers will receive benefits without having to fill out a new application. A national per hundred weight payment rate will be determined by dividing the available funding of $290 million, less a reserve established by FSA (to cover new applicants and appeals), divided by the total pounds of eligible milk production approved for payment.
Based on current information, FSA estimates that 875 million cwt. of milk production will be eligible for payment.
To be eligible for DELAP, FSA says the dairy producer and the dairy operation in which the producer has a share:
· Must have produced milk in the United States and marketed milk commercially at any time from February through July 2009;
- Must have milk production data for those months; Must certify to all milk production produced and marketed by the dairy operation during that time.
Also, any dairy producer who has an annual average adjusted gross nonfarm income of more than $500,000 for calendar years 2006 through 2008 is not eligible for DELAP.
For more information and eligibility requirements on the new DELAP program, please visit your local FSA county office or www.fsa.usda.gov.