The federal dairy margin support program's enrollment window for next year opened on October 7, and the phones at the federation office have been busier than usual because of it. The filing deadline isn't until mid-December, so members have time, but this year's decision is harder to make on autopilot than last year's was, and a few members told us they'd rather work through it now than in the last week of the window.
Part of the reason is that the number picture has actually moved. Barrel and block cheese have both firmed up since midsummer, with block cheddar running a little ahead of barrels most weeks this month. That's a better spot than a year ago, when the case felt stuck. But margin coverage isn't really a bet on cheese prices alone — it's a bet on the gap between the milk check and what feed costs. A handful of members who called us this week were surprised how much of the 2020 premium math depends on feed assumptions they hadn't updated since spring.
What we're hearing from members
Smaller operations — the ones milking under a few hundred cows or running a farmstead herd alongside the cheese room — are the ones asking the most questions, which tracks with how the program is built. The lower coverage tiers are effectively free or close to it for the first slice of production, so the calculus for a small producer is less "should I enroll" and more "how high do I go, and does it change what I do with the wholesale side of the business." A few members told us they're treating this year's election as insurance against a repeat of last year's feed cost spike rather than as a bet on where cheese prices land.
Larger members with more diversified revenue — retail counters, export lines, private-label wholesale — are generally telling us the calculation matters less to them this year than it did in 2018, simply because the underlying margin has been less volatile. That's not universal, and we'd rather members run their own numbers than take our word for it either way.
None of this happens in a vacuum, either. Cheese export demand has been a mixed bag all year, with tariff lines on both sides of a couple of major markets shifting more than once since spring. We've written before about the twenty-five percent line on some imported wheels and about tariff retaliation risk on the export side; neither situation is fully resolved, and members selling into Mexico or the EU in particular should keep an eye on their own trade lanes rather than assume this year's terms hold into next year unchanged.
What we'd ask before you file
Two questions come up in nearly every conversation we've had this month, and they're worth asking yourself before you file anything. First: are you basing your feed cost assumption on this year's numbers or last year's? A surprising number of members told us they hadn't touched the feed side of the worksheet since their first year in the program, even though feed markets have moved twice in that span. Second: does your coverage level make sense next to the rest of your risk picture — crop insurance if you grow your own feed, a forward contract on part of your milk, a cash reserve you're already carrying? Margin coverage isn't meant to be the only tool in the box, and members who treat it that way tend to either over-insure at real cost or under-insure and find out the hard way.
None of this is a reason to rush. It's a reason to actually sit down with the worksheet rather than re-checking last year's box out of habit.
If you're weighing your own enrollment decision, the federation doesn't offer individual financial advice, but our Membership & Outreach Committee can point you to the program's own worksheets and to members in your region who've been through a coverage election before. Reach out through the member portal if you want a name to call.
The International Cheese Federation (ICF) and More Cheese are entirely fictional. This post is demonstration content created for MemberJunction. All people, organizations, events, courses, certifications, figures, and quotations in it are invented, and nothing here represents a real association, a real business, a real person, or real professional advice.