These monthly feed price calculations include Farm Service Agency’s (FSA) MPP-Dairy national average dairy feed cost, and the Economic Research Service’s U.S. estimate of total feed costs. MPP-Dairy is a farm safety net program administered by USDA FSA, and program payments are triggered using FSA-estimated dairy feed costs. However, the presence of an alternative, and higher-valued ERS estimate of dairy feed cost may represent a source of confusion with respect to MPP-Dairy performance given that both feed cost estimates are announced near the end of the month and both draw upon data from the National Agricultural Statistics Service (NASS) Agricultural Prices report.
University of Illinois’ John Newton, Department of Agricultural and Consumer Economics, and Mike Hutjens, Professor Emeritus, Department of Animal Sciences, provide insight on the sources of difference and risk management implications with respect to these two estimates of dairy feed costs.
Source: DairyHerd
