Dairy Provisions in the 2018 Farm Bill

 Premiums and coverage levels are presented in Figures 1 and 2 for the 2014-2017 period of the 2014 farm bill vs. the 2019-2023 period of the 2018 farm bill.  This comparison argues that, for dairy commodity support policy, the Bipartisan Budget Act of 2018 and Agricultural Improvement Act of 2018 should be treated as the 2018 farm bill.  Taken together the two bills expand the covered milk production history that qualifies for Tier I protection by 25% (5 vs. 4 million pounds), substantially reduce Tier I premiums (for example, by 79% at the $8.00/cwt. coverage margin), adds higher Tier I coverage margins ($8.50, $9.00, and $9.50 per cwt.), and expands the share of production history a dairy can elect to cover from 25%-90% to 5%-95%, with both ranges at 5% increments.  By allowing coverage down to 5%, herds with production up to 100 million pounds (approximately 4,000 average milk cows) can limit covered milk production to Tier I.  In contrast, Tier II premiums are raised at coverage margins above $5.50/cwt. (for example, by 34% at the $8.00/cwt. margin).  Covered production history is the largest production in 2011, 2012 or 2013.