Iowa Farm and Ranch - agNET FFA News - FSA Provides Dairy Economic Loss Assistance Payments

1/15/2010 9:09:51 AM

FSA Provides Dairy Economic Loss Assistance Payments

Adrian J. Polansky, state executive director of USDA's Farm Service Agency (FSA) in Kansas announced the implementation of the new Dairy Economic Loss Assistance Payment (DELAP) program. The 2010 Agricultural Appropriations Bill authorized $290 million for loss assistance payments to eligible dairy producers.

"Federal Regulations for this program were published on December 21, 2009 and FSA started issuing payments that same day," Polansky said. "Through this program, eligible dairy producers will receive economic assistance that will help stabilize their operations during these tough economic times."

Milk prices declined substantially through early-to-mid-2009. On average, the price U.S. dairy producers received for milk marketed in the summer of 2009 was about half of what it cost them to produce milk.

Dairy producers who have production records at the USDA Farm Service Agency (FSA) county office because they participated in another FSA dairy program did not need to apply for the program. FSA used existing production records for February through July 2009 to calculate and issue their payments.

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. The payment rate is $00.3211641 per cwt.

Kansas FSA has issued over $2 million in DELAP payments to 425 dairy producers.

Producers who have not provided production data for Feb. through July 2009 to FSA, and have not already been contacted by FSA to provide such data, have until Jan. 19, 2010 to apply for a DELAP payment.

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.