Dairy Revenue Protection Insurance is a USDA subsidized insurance product that protects against unexpected declines milk revenue. DRP Insurance provides coverage against milk market price declines for Class III, Class IV and Components on a quarterly basis, making it an important tool for hedging volatile dairy markets.
Insure against declining milk futures prices
Offered daily to producers who can purchase coverage for up to 5 nearby quarters
Maintain flexibility to higher prices
44-55% subsidy based on coverage level
Premium costs are due at the end of the quarter insured
Producers may cover 80 – 95% of their expected quarterly revenue
Options to use Class or Component pricing as basis for revenue
Ability to elect the quarterly insurance period, quantity of milk and protection factor each for coverage endorsement
Settles to quarterly average of announced Class III, Class IV, or component prices, dependent on election
DRP daily pricing calculator for Class and Component pricing
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