---
kind: "section"
citation: "7 U.S.C. § 7982"
title: "7"
title_heading: "Agriculture"
number: "7982"
heading: "National dairy market loss payments"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/7/7982"
units:
  - "Chapter 106 — Commodity Programs"
  - "Subchapter V — Dairy"
---

# §7982. National dairy market loss payments

- (a) **Definitions—** In this section:
  - (1) **Class I milk—** The term “Class I milk” means milk (including milk components) classified as Class I milk under a Federal milk marketing order.
  - (2) **Eligible production—** The term “eligible production” means milk produced by a [producer](/usc/7/7901.md?p=12) in a participating [State](/usc/7/7901.md?p=14).
  - (3) **Federal milk marketing order—** The term “Federal milk marketing order” means an order issued under [section 608c of this title](/usc/7/608c.md).
  - (4) **Participating State—** The term “participating [State](/usc/7/7901.md?p=14)” means each [State](/usc/7/7901.md?p=14).
  - (5) **Producer—** The term “[producer](/usc/7/7901.md?p=12)” means an individual or entity that directly or indirectly (as determined by the [Secretary](/usc/7/7901.md?p=13))—
    - (A) shares in the risk of producing milk; and
    - (B) makes contributions (including land, labor, management, equipment, or capital) to the dairy farming operation of the individual or entity that are at least commensurate with the share of the individual or entity of the proceeds of the operation.
- (b) **Payments—** The [Secretary](/usc/7/7901.md?p=13) shall offer to enter into contracts with [producers](/usc/7/7901.md?p=12) on a dairy farm located in a participating [State](/usc/7/7901.md?p=14) under which the [producers](/usc/7/7901.md?p=12) receive payments on eligible production.
- (c) **Amount—** Payments to a [producer](/usc/7/7901.md?p=12) under this section shall be calculated by multiplying (as determined by the [Secretary](/usc/7/7901.md?p=13))—
  - (1) the payment quantity for the [producer](/usc/7/7901.md?p=12) during the applicable month established under [subsection (d)](#d);
  - (2) the amount equal to—
    - (A) $16.94 per hundredweight; less
    - (B) the Class I milk price per hundredweight in Boston under the applicable Federal milk marketing order; by
  - (3)
    - (A) during the period beginning on the first day of the month the [producers](/usc/7/7901.md?p=12) on a dairy farm enter into a contract under this section and ending on September 30, 2005, 45 percent; and
    - (B) during the period beginning on October 1, 2005, and ending on September 30, 2007, 34 percent.
- (d) **Payment quantity—**
  - (1) **In general—** Subject to [paragraph (2)](#d-2), the payment quantity for a [producer](/usc/7/7901.md?p=12) during the applicable month under this section shall be equal to the quantity of eligible production marketed by the [producer](/usc/7/7901.md?p=12) during the month.
  - (2) **Limitation—** The payment quantity for all [producers](/usc/7/7901.md?p=12) on a single dairy operation during the months of the applicable fiscal year for which the [producers](/usc/7/7901.md?p=12) receive payments under [subsection (b)](#b) shall not exceed 2,400,000 pounds. For purposes of determining whether [producers](/usc/7/7901.md?p=12) are [producers](/usc/7/7901.md?p=12) on separate dairy operations or a single dairy operation, the [Secretary](/usc/7/7901.md?p=13) shall apply the same standards as were applied in implementing the dairy program under section 805 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2001 (as enacted into law by Public Law 106–387; 114 Stat. 1549A–50).
  - (3) **Reconstitution—** The [Secretary](/usc/7/7901.md?p=13) shall promulgate regulations to ensure that a [producer](/usc/7/7901.md?p=12) does not reconstitute a dairy operation for the sole purpose of receiving additional payments under this section.
- (e) **Payments—** A payment under a contract under this section shall be made on a monthly basis not later than 60 days after the last day of the month for which the payment is made.
- (f) **Signup—** The [Secretary](/usc/7/7901.md?p=13) shall offer to enter into contracts under this section during the period beginning on the date that is 60 days after May 13, 2002, and ending on September 30, 2007.
- (g) **Duration of contract—**
  - (1) **In general—** Except as provided in [paragraph (2)](#g-2), any contract entered into by [producers](/usc/7/7901.md?p=12) on a dairy farm under this section shall cover eligible production marketed by the [producers](/usc/7/7901.md?p=12) on the dairy farm during the period starting with the first day of month the [producers](/usc/7/7901.md?p=12) on the dairy farm enter into the contract and ending on September 30, 2007.
  - (2) **Violations—** If a [producer](/usc/7/7901.md?p=12) violates the contract, the [Secretary](/usc/7/7901.md?p=13) may—
    - (A) terminate the contract and allow the [producer](/usc/7/7901.md?p=12) to retain any payments received under the contract; or
    - (B) allow the contract to remain in effect and require the [producer](/usc/7/7901.md?p=12) to repay a portion of the payments received under the contract based on the severity of the violation.

## Source credit

(Pub. L. 107–171, title I, § 1502, May 13, 2002, 116 Stat. 205; Pub. L. 109–171, title I, § 1101, Feb. 8, 2006, 120 Stat. 4; Pub. L. 110–28, title IX, § 9006(a), May 25, 2007, 121 Stat. 217.)

## Notes

### Editorial Notes

### References in Text

Section 805 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2001, referred to in subsec. (d)(2), is section 805 of Pub. L. 106–387, § 1(a) [title VIII], Oct. 28, 2000, 114 Stat. 1549, 1549A–50, which is not classified to the Code.

### Amendments

2007—Subsec. (c)(3). Pub. L. 110–28 inserted “and” at end of subpar. (A), substituted “September 30, 2007, 34 percent.” for “August 31, 2007, 34 percent; and” in subpar. (B), and struck out subpar. (C), which read as follows: “during the period beginning on September 1, 2007, 0 percent.”

2006—Subsec. (c)(3). Pub. L. 109–171, § 1101(a), added par. (3) and struck out former par. (3) which read as follows: “45 percent.”

Subsec. (f). Pub. L. 109–171, § 1101(b), substituted “2007” for “2005”.

Subsec. (g)(1). Pub. L. 109–171, § 1101(b), (c)(1), struck out “and subsection (h) of this section” after “paragraph (2)” and substituted “2007” for “2005”.

Subsec. (h). Pub. L. 109–171, § 1101(c)(2), struck out subsec. (h), which related to transition rule.