Dairy policy reform about to begin

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Dairy policy reform could get under way as early as February, once congressional agricultural committees re-convene and take up the next Farm Bill.

Congressman Collin Peterson, ranking member of the House Agriculture Committee, told Agri-Talk radio on Thursday that he and his colleagues plan to begin discussion of the Farm Bill next month and will try to get the bill done by May or June.

 “I think we’ll get a good bill out of committee in both the House and the Senate,” Peterson said. “What I’m worried about is what happens on the floor (of Congress after it leaves committee),” he says. “We could get in a situation where we get an unholy alliance between the left and the right” that could significantly change what comes out of committee, he adds.

With regard to dairy reform, Peterson has introduced the Dairy Security Act of 2011 that would provide farmers with “margin protection” against unfavorable swings in feed prices relative to milk prices.

The proposed legislation has “pretty good support across the industry,” he said, with the exception of the International Dairy Foods Association (IDFA).

IDFA, which represents dairy processors, is opposed to the “dairy market stabilization” provision of Peterson’s bill that would kick in and potentially limit milk production increases when producers experience low or negative margins, such as occurred in 2009.

The Dairy Security Act would be a voluntary program. And, some changes have been made to make it more appealing to smaller-sized dairies, Peterson says.

Peterson said he thinks the Dairy Security Act is about where it needs to be. “We’re just waiting for a vehicle,” he added.

That vehicle is the Farm Bill.

Although discussions on the Farm Bill will begin soon, the whole process could drag into 2013, Peterson says. “That would be a very bad outcome, because I think things are going to be worse in 2013 than they are now, so there is no advantage to agriculture to have this delayed.”

Many observers believe the budget-cutting pressure in Washington, D.C., will simply increase in coming years.  

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NY  |  January, 13, 2012 at 08:46 AM

Hmmm, why do dairy reform policies need any sort of approval from processors? Processors don't ask for our input on the products they market. They make what they think will sell. Don't they?

WI  |  January, 13, 2012 at 01:03 PM

Nope processors do not make products that customers want to buy, current dairy policy allows them to make whatever they want regardless of the price they can sell it for and stick farmers with the bill. Ex last month the Class III was $18.77 and the Class IV was $16.87 a near $2.00 spread. So a cheese plant paid $2.00 more for milk than a butter plant, however butter production was not down. Butter plants didn't have to pay cheese prices, the federal order system allowed them to buy it for $2.00 less. All this nonsence got balled up into the pool and you wonder why your PPD was so low. Farmers need to stop being so IGNORANT about how the sell their milk both today and in the future. The federal order system is the cause, not the solution to your problems.

Tammy Piotraschke    
Powers, MI  |  January, 13, 2012 at 12:50 PM

"Dito". It is time all farmers stick together for us. We can feed a good portion of the world, but have a had time agreeing with each other on the really important stuff. Like the future of production farming in the U>S>A>

milk producer    
deposit ny  |  January, 13, 2012 at 03:03 PM

Back in the day someone came around wanting registered heifers donated to countried overseas...now its a global market we are trying to fit in. Where once countries couldnt make thirty pounds of milk out of a cow now they have ours and making twice as much. Stop letting people who have no clue what they are doing to us in long run make decisions.

Jackie Schmiddts    
Lake Placid, NY  |  January, 14, 2012 at 11:34 AM

Since when does one segment of the American public dictate entire policy. Policy should be debated between all policies, in this case from dairy farmers, processors, retailers and customers. What Rep. Peterson is proposing is a new system of more government internvention and control. When will producers wake up and realize that it is not the processor, (and remember processors and manfuacturers are the customers of dairy farmers) other dairy farmer created dairy price policy decisions that have led you to the point you are now at. The only answer for all dairy producers is to free yourselves from the bondage of government created artifical price discovery programs that is holding you back. If this proposed supply manangement program is actually implemented, it will only mean further decline of fluid milk sales and decreased consumption of dairy products in general.

George Mueller    
Clifton Springs, NY  |  January, 15, 2012 at 06:53 PM

Thank you, Jackie, for adding some common sense to the discussion of the Dairy Security Act. You are "right on" mentioning that processors, retailers, and consumers are our customers and we will do well to serve them as best we know how. Low prices will slow down our production in surplus periods just as they did in 2009. We don't need some complicated system to manipulate the market, artificially cut production, and thus extort a better price from our very valuable customers. World markets are beginning to purchase our milk products. Fourteen percent of our production in 2011 and growing. Middle class people around the world have U. S. dollars to spend on our nutritious milk products. This is no time to devise a socialistic plan to cut production and price ourselves out of world and domestic markets!

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