Archive for the ‘Brian Gould’ Category

University Team to Create Web Based Margin Protection Tool

June 10, 2014 — Members of the Dairy Markets and Policy Team were asked by the Farm Services Agency of the U.S. Department of Agriculture to partner with them in developing a web-based tool that will assist farmers in making their decisions about participating in the new Margin Protection Program for Dairy Producers (MPP). In addition to developing the tool, the team will organize various educational activities and materials to help producers understand how they can use the tool, identify the nuances of how the program works, and think about the milk price and margin risks they face.

“In designing and developing these materials we fully expect to work with and be a resource for the large network of extension educators and industry partners who are routinely in the business of working with dairy farmers and helping them gather the information to think about the management decisions they face every day,” the team said in a statement.

The partnership with USDA will allow FSA and the University based team to coordinate separate responsibilities for the ultimate benefit of dairy farmers. FSA and its regional offices will be the source of information and place to go for producers who want specific information about the program, signup procedures and other specific program information such as eligibility, payment processes and so on. USDA can answer questions about how MPP works and can show interested parties how to find the University based materials. There will be a link to all the Farm Bill decision tools on the USDA website. However, USDA staff will not provide advice to farmers on what decision they should make under MPP.

Our decision support aids will not be designed to provide financial or risk management advice, rather we will try to give producers the tools to help them make the most informed MPP coverage decisions for their farm operation,” team members said. “We encourage producers to take full advantage of all the resources available to them. This is a brand new program, with new rules and new mechanisms. We know quite a bit about the sequence of things that need to happen before MPP is formally launched, but we do not have a specific timetable.”

The Agricultural Act of 2014 instructs USDA to “establish and administer” the new program by 1 September. In the press release announcing the University awards, USDA states: “Sign-up for the newly established Margin Protection Program for Dairy (MPP) begins late this summer”.

This is a strong indication of their goal but not a specific timetable for the various steps of releasing the rules, starting a sign-up period, and concluding enrollment. There remain many details for FSA to sort out in the implementation of the final and formal program. The framework for a MPP decision tool has been created, but the University team will need to know the final rules before a tool can be finalized and released publically. At this time, they cannot be more specific about when the tool will be available. USDA is already beginning to provide information about the program and will no doubt add to the information on their website as new information becomes available.

Although it is difficult to plan a specific schedule or even to know how much time will be available for various activities, the team is developing a multipronged education plan. There will be web-based educational materials and webinars, but team members also want to do some hands-on workshops.

“As a group, our focus will be on several “trainthe- trainer” type workshops around the U.S. We anticipate that extension educators and industry groups will be developing local educational programs,” they said.  “Indeed, USDA is providing additional funding to State Cooperative Extension systems to support the overall producer education effort relative to new FSA-based programs. In our home states and in collaboration with partners elsewhere, we intend to be involved in more direct producer training as well. It will be our highest priority to provide producers with the tools and information that will help them to make the most informed decision possible.”

In the coming weeks and months, producers may visit: for information on the tool and our educational activities. This website contains publications, data tools, and a variety of information generally applicable to dairy markets and policy.

Members of the Dairy Markets and Policy Team :
Marin Bozic, University of Minnesota
Brian Gould, University of Wisconsin
John Newton, University of Illinois
Charles Nicholson, Penn State University
Andrew Novakovic, Cornell University
Mark Stephenson, University of Wisconsin
Cameron Thraen, Ohio State University
Christopher Wolf, Michigan State University


Risk Management Decisions

April 29, 2014 — Dairy producers have a decision to make on what type of risk management program is best for them. University of Wisconsin’s Brian Gould says several questions need to be answered before deciding.

Dairy Title Leaves Much Discretion to Ag Sec

Brian Gould

Brian Gould

January 31, 2014 — Dr. Brian Gould doesn’t agree with the Wall Street Journal’s assessment that dairy farmers are losers in the new Farm Bill. Speaking in Friday’s DairyLine broadcast, Gould said the Margin Insurance Program was one of the things dairy producers, via the National Milk Producers Federation, wanted. “That’s not a loss,” he said. “It’s going to be more market driven and there’ll be more producer decision making involved.” Gould said “The strength is individual decision making in terms of participating in that margin insurance program and there’s no requirement.”

One of his issues with the dairy title is that, if producers participate in the USDA Margin Program they’re not allowed to participate in the Livestock Gross Margin (LGM) program. He’s not sure why but says, perhaps it’s because they are both subsidized.

The LGM is a revenue insurance program for dairy producers that has been around since August 2008, according to Gould, and is used to set minimum margin floors. It’s very similar to the USDA Margin Program but is more flexible, he said, can be entered into multiples times per year, and the costs are comparable at least at the upper coverage levels to what the USDA premiums are.

As to the Margin Insurance Program, Gould said national average prices are used, no local bases. The premiums are differentiated by farm size, in terms of your history, with 4 million pounds or less considered a smaller operation, and anything over 4 million considered larger and will have a different premium schedule. Gould’s understanding is that the premiums for the $4 margin are 100% subsidized  but anything else in 2014 and 2015 there will be a 25% reduction in the premiums for smaller operations.

The dairy title is fairly short, Gould concluded. A lot of rules in terms of development are left up to the Secretary of Agriculture. As an example, Gould said it’s not clear whether a farmer has to enter once for five years or once a year and “that has some significant implications in terms of risk management activities.”

Mailbox Price Comparisons

June 11, 2013 — Brian Gould is professor at the Dept. of Ag and Applied Economics at the University of Wisconsin-Madison. He looks ahead at the difference in mailbox prices between California and Wisconsin. Listen to the podcast below and view his website here:




Brian Gould

Latest on MILC Payment Projections

January 29, 2013 – Dairy economist Brian Gould from the University of Wisconsin shares with DairyLine Radio listeners the latest projections the Milk Income Loss Contract.

LGM-Dairy Sale is Friday

(August 29, 2012) USDA’s Risk Management Agency (RMA) is offering a Livestock Gross Margin-Dairy Insurance policy sale Friday. Brian Gould is professor at the Department of Agriculture and Applied Economics at the University of Wisconsin-Madison and spoke with DairyLine about last Friday’s announcement.


DSA’s Potential Structural Change in Milk Pricing

(April 17, 2012) The proposed Dairy Security Act may see a transition to new competitive pay prices. University of Wisconsin’s Brian Gould discusses the potential structural change in mik pricing and the fluid milk futures contract on Tuesday’s DairyLine.

LGM Should Get Out Of Pilot Status

(February 7, 2012) Brian Gould from the Unversity of Wisconsin-Madison discusses why the Livestock Gross Margin insurance program should get out of pilot status.

LGM Insurance Gets Gobbled Up

(November 25, 2011) Another sales period for Gross Livestock Insurance was gobbled up during Thanksgiving week.  Brian Gould, from the University of Wisconsin-Madison,  joined us on Friday to discuss the latest LGM sale, scheduled November 18th

Market Talk with Brian Gould

The August Consumer Confidence Index declined from 59.2 percent to 44.5 percent, according to Brian Gould, Associate Professor and the Department of Agricultural and Applied Economics at the University of Wisconsin-Madison.

“Consumer confidence and the willingness for consumers to go out and purchase food away from home are very important to the dairy industry,” he said.

Switching gears, Gould anticipates CME spot cheese prices will remain in the $1.70’s. The most recent data available show the ratio of American cheese stocks to American cheese production in July as the highest since August of 1987.

“So we had a lot of stocks out there relative to production and I’m not optimistic that there is going to be a rebound in those cheese prices in the near future,” he said.

Futures prices remain fairly stable.

“They are about $1.70, plus or minus five cents,” he said. “Right now the indicators are not looking for substantial changes on the upside or either on the downside.”

The August Federal Order Class III milk price is $21.67, likely the peak for the year.

“If you look at Class III future settled prices just prior to the announcement of the August value – for example the September settled price on that day was $18.87, the highest on the board and continually declines by June of next year about $17.00, so still relatively high, but I don’t see $20.00 on the board at this time,” he concluded.