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How Sensitive are the Frequencies and Magnitudes of MPP-Dairy Indemnities?

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  • Mark, Tyler B.
  • Burdine, Kenneth H.
  • Halich, Greg

Abstract

Establishment of the Margin Protection Program offers dairy producers a guaranteed margin based on a set formula and fixed premiums for the life of the 2014 Farm Bill. The results of this work provide valuable framework and insight into the frequency, magnitude, and sensitivity of indemnity payments with respect to changes in prices. Current price expectations suggest limited payout expectations during the time period for the baseline scenario. However, the frequency and magnitude of indemnity payments can change significantly if milk and feed costs vary from the baseline scenario.

Suggested Citation

  • Mark, Tyler B. & Burdine, Kenneth H. & Halich, Greg, 2014. "How Sensitive are the Frequencies and Magnitudes of MPP-Dairy Indemnities?," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 32(2).
    • Handle: RePEc:ags:jloagb:311255
    DOI: 10.22004/ag.econ.311255
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    Agribusiness;

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