Milk Income Loss Contract Program [MILC] Law and Legal Definition

Milk Income Loss Contract (MILC) Program is a safety net program initiated by the federal government for assisting dairy farmers. The MILC was established under the 2002 farm bill. Under the MILC, dairy farmers nationwide are eligible for a federal payment whenever the minimum monthly market price for farm milk used for fluid consumption falls down. Essentially, when the market price for milk goes up, the program payment rate drops.

The MILC was established for the purpose of benefiting all dairy operations, regardless of size. It has been the lifeline for many small dairy producers and families across the country.

According to 7 CFR 1430.210, an authorized MILC agent must on behalf of the dairy operation do the following:

1.Obtain an acceptable power of attorney or acceptable equivalent for the producers of the dairy operation that authorizes the agent to enter into an MILC contract;

2.Enter into a written agreement with the Commodity Credit Corporation (CCC) for approval to act as an MILC agent on a form prescribed by CCC;

3.Provide a dairy operation's monthly production evidence to the appropriate Farm Service Agency office (FSA);

4.Disburse payment to a dairy operation in a producer's monthly milk check or in an otherwise approved manner.

MILC benefits may be distributed by a dairy marketing cooperative that serves special groups or communities, such as an Amish or Mennonite community. Producers in such groups in a dairy operation may authorize an agent of a dairy cooperative or milk handler affiliated with such cooperative to obtain and distribute MILC benefits to the dairy operation.