GLOSSARY

American Cheese:

Principally cheddar cheese but includes other varieties such as Colby or Jack. The term does not include Swiss, Muenster, Blue, Italian cheese varieties, and other distinctive types.

Commercial Disappearance:

Commercial consumption calculated as production plus imports less the net change in stocks and non-commercial use. Domestic commercial disappearance is total commercial disappearance less commercial exports. May include farm use, waste, shrinkage, some inventory variation, and products used for other than human consumption.

Milk Equivalent:

The amount of farm milk represented by a quantity of dairy products. Most often used to aggregate stocks, trade, or removals of various dairy products on a common component basis, such as milkfat, skim solids, or total milk solids.

Milk Sold to Plants and Dealers:

A term long used by USDA to mean milk production less that portion utilized on the farm or marketed directly by farmers to consumers.

DMC (Dairy Margin Coverage program) Margin:

As defined in the 2018 Farm Bill, the income over feed cost margin is equal to the national monthly all-milk price (reported monthly by USDA NASS) minus average feed costs, computed from a formula using national benchmark prices of corn, soybean meal, and alfalfa hay. Formerly the MPP (Margin Protection Program for Dairy) Margin.

DMC (Dairy Margin Coverage program) Feed Cost:

As defined in the 2018 Farm Bill, the feed cost to be used in calculating premiums is the national average feed cost. It includes the U.S. average corn price/bushel, Central Illinois soybean meal price/ton, and price of alfalfa hay price/ton. Formerly the MPP (Margin Protection Program for Dairy) Feed Cost.

National Average Cost of Feed Calculation:

=1.0729 X U.S. average corn price/bushel +0.00735 X Central Illinois soybean meal price/ton +0.0137 X Average of U.S. average alfalfa hay price/ton and 5-state average of premium and supreme alfalfa hay (scheduled for recalculation, from January 2020, as 100% of the 5-state dairy quality alfalfa hay price). 46