Federal dairy farmers saw improved conditions in April as the Margin Coverage Program administered by USDA reported a margin of $10.54 per hundredweight, representing an increase of $0.97 per hundredweight compared to the previous month. This marked the second month in a row during 2024 where the Program did not trigger payments at any coverage tier. The improved margin resulted from a $1.10 per hundredweight jump in the all-milk price compared to March, along with a $0.13 per hundredweight rise in the April DMC feed cost calculation, which was influenced by modest increases across all three feed ingredients in the formula.
By the conclusion of May, USDA’s DMC Decision Tool website indicated projections showing no additional DMC payments expected for the remainder of the year, with the exception of a potentially minor payment in August. The forecast covering the final eight months of the year revealed an uncommon pattern with two margin peaks, both reaching slightly over $11.00 per hundredweight in May and November, separated by a low point of $9.70 per hundredweight in August, with an annual average of $10.05 per hundredweight.
