MPP Disappoints, Lawmakers Looking for Fixes

The dairy margin protection program, or MPP, was a disappointment to both producers and lawmakers in 2016 with low participation numbers and an imbalance in costs and benefits.

The House Ag Committee held hearings Wednesday that looked at how MPP could be improved as University of Missouri economist Dr. Scott Brown said producers were disenchanted and lowering premiums may not help.

“I found dairy producers very disinterested in making payments for premiums and getting nothing in return and so I’m not certain that lowering premiums generates a lot of additional participation in the program.”

But Brown noted it wouldn’t hurt to try it, though acknowledged that there is a challenge in government subsidies that become too attractive.

“It’s a tightrope we have to walk between providing a safety net without it becoming too lucrative.”

If it offers too much support, MPP could lead to a massive increase in production which will drop prices significantly.