Western United Dairymen’s request that USDA make a surplus cheese purchase of 100 million pounds for direct donations to food banks received a boost last week with an analysis showing such a move would provide the greatest benefit to producer milk prices at this time.
National Milk Producers Federation (NMPF) President Jerry Kozak released an economic analysis of options for $350 million included in the Senate Ag Appropriations bill. The NMPF analysis calculates a return on investment scenario that makes it “dramatically clear … that the purchase of cheese for use in domestic feeding programs, primarily food banks, would provide the biggest benefit to the producer milk price at this time,” said Kozak.
The $350 million, included in the Senate version of the appropriations bill through an amendment by Bernie Sanders (D-Vermont), could fund the purchase of an additional 210 million pounds of processed cheese, according to the analysis. The impact of this additional product use could be up to $1.3 billion in enhanced producer income. In contrast, the analysis says that using the money for an increase in price support levels would raise producer income by only $185 million, while increasing direct payments with the funds would raise producer income by $335 million.
The analysis was hailed by WUD President Ray Souza as yet another indicator of the strength of the cheese purchase proposal. “This analysis clearly points out the powerful impact that a large cheese buy will have on the marketplace,” said Souza. “We are pleased to be working with National Milk; National All-Jersey; Western States Dairy Producers Trade Association; California Dairies, Inc.; our California senators, Barbara Boxer and Dianne Feinstein; Congressman Dennis Cardoza; and food bank organizations to push this proposal forward when Congress returns to work.”
Souza first brought forward the cheese purchase idea in testimony before Congress in mid-July. He made a personal appeal to USDA Secretary Vilsack at a Rural Tour forum held on August 26 in Modesto. Vilsack indicated support, but expressed concerns about acting quickly because USDA funds will be depleted before the fiscal year ends October 1. Rep. Dennis Cardoza (D-Merced), who hosted the forum, indicated that he would ask his colleagues to act quickly on the proposal when Congress goes back into session on September 8.
The House version of the appropriations bill does not carry the $350 million provision. The task ahead will be focused on the conference committee as they seek to reconcile both versions. Said Souza, “We look forward to working with Congressman Cardoza and other members of the California delegation to make this proposal a reality sooner rather than later.”
Source: Western United Dairymen