Testifying at the Assembly hearing, Sacramento County dairy farmer Antoinette Duarte recounted the difficult times for California producers in recent years, with "all-time high" feed costs for two years straight and now a gloomy forecast for this year's corn production, as farmers in the nation's Corn Belt deal with flooding and delayed planting (see story).
"The dairy producers of California are in crisis," she said, noting that more than 360 dairies have closed in recent years and another hundred are threatened with closure this year. "We, the families that have been in the dairy business for many generations, no longer talk about growth; we talk about survival."
Naming the various dairy and agriculture groups that support AB 31, she said, "I believe this is the first time that we all agree on a critical solution for the survival of our California dairy farms."
Giving a history of whey pricing, Eric Erba, senior vice president and chief strategy officer of California Dairies Inc., the state's largest dairy cooperative, pointed to the $1.95 per hundredweight difference in the last two years between the state whey value factor for the 4b price and the whey value in the federal orders.
He told committee members that the original contents of AB 31 "were on target to fix the inequity."
"It didn't ask for everything that's outside of California in terms of how it's priced," he said. "It asked for a high percentage, and the high percentage would be satisfactory enough to get us on the right track."
Joe Lang, testifying for the Dairy Institute of California, which represents processors, noted that whey was once considered a waste product but is now a valuable commodity.
"That effort, however, didn't come without a price, and the price was very substantial in terms of the amount of investment that was required to address and change the problem," he said.
The question now is, "How do we fairly assess the value of that new commodity and how do we make sure that collectively, as an industry, dairymen can stay in business?" Lang added.
Assembly Member Mariko Yamada, D-Davis, said while she recognizes the "very critical problem" facing the state's dairy farmers, she could not support the original legislation but encouraged the parties to work together to address the issues dairy farmers face.
Assembly Member Bill Quirk, D-Hayward, also expressed reservations about passing AB 31 in its original form, saying that if legislators set a milk pricing formula using the federal whey price as an anchor, "we really don't know what that's going to be in the future."