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What the Dairy Industry Really Needs

November 29, 2012

Editor’s note: Caught between the high price of feed and fuel and the low price they get for their milk, local dairy farmers lose money every time they milk a cow. Statistics show that nationwide, dairy farmers lost $10.05 for every hundred pounds of milk they sold in July; in August, -$9.52; and in September, -$9.40. It’s a wonder any of the small, family farms we know in our area can stay in business! (If this keeps up, some will not.)

Now, the 2012 Farm Bill, which purports to address this problem, is once again before Congress. In June, the Senate passed its version of the Farm Bill, but the House failed to do so before adjourning for elections at the end of September allowing the previous 2008 farm legislation to expire. Both versions of the 2012 Farm Bill would replace several existing dairy price support programs with one margin insurance program based on the difference (the margin) between feed prices and milk prices.

Under this voluntary insurance program, farmers who opt in would receive payments when the price of milk drops too low in relation to the cost of feed. However, the participating farmer also would be required to reduce his milk production when there is too much milk supply in the U.S.

With this as background, here is an op-ed essay from Nate Wilson, a former dairy farmer of 40 years from Sinclairville, NY, Chautauqua County, who contends that this “solution” is not what dairy farmers need.

[Reprinted here with permission]

In the November 15th edition of “Dairy Business,” the Northeast Dairy Foods Association (NDA) came out swinging at a key dairy provision in the proposed 2012 Farm Bill. Seems the NDA enthusiastically supports the taxpayer funded dairy margin insurance scheme in the proposed Farm Bill. But, the supply management portion of it—not so much.

In fact, NDA is down-right sour on any supply management provision; that smacks of interfering with what its member processors see as their God-given right to access ruinously undervalued farm milk. Accordingly, they have assigned their top hired gun, Bruce Krupke, to spearhead a public relations blitz on Congress in an effort to “do to death” any concept of this dreaded “supply management.” This would be accomplished by amending the current legislation with the Goodlate-Simpson Amendment. It would give the green light to taxpayer-funded dairy margin insurance while neatly tucking any pesky supply management horrors into an unmarked grave. While this fits the needs of NDA, there is a more taxpayer friendly, practical approach.