The House Livestock, Dairy and Poultry Subcommittee released its preliminary discussion draft of the items under its jurisdiction for the next farm bill. Highlights for the dairy industry include:

  • Price support program. The proposed plan calls for the secretary of agriculture to support the price of cheddar cheese at $1.13 for blocks, $1.10 for barrels, $1.10 for butter and $0.80 for nonfat dry milk. This is instead of the current $9.90 support price for milk. If net removals of cheese, butter or nonfat dry milk exceed specific limits for 12 consecutive months, the purchase prices of that commodity may be reduced during the following month.
  • Forward pricing. The proposal calls for the dairy forward pricing program, which was a pilot program, to be made permanent. This authorizes milk producers and cooperatives to voluntarily enter into forward price contracts with milk handlers.
  • DEIP. The proposal extends the dairy export incentive program until Dec. 31, 2012.
  • FMMO.   The plan sets forth the procedures the secretary of agriculture must follow upon receiving a written request for a hearing to amend a milk marketing order, and establishes a timeline in which action must be taken.
  • Nonfat dry milk. The plan requires the secretary of agriculture to submit a report to Congress within 90 days regarding the Department of Agriculture’s reporting procedures for nonfat dry milk and the impact of those procedures on Federal milk marketing order minimum prices.

The proposal does not address the Milk Income Loss Contract, which is set to expire August 30. Unless MILC receives funding through September 2007 so that it expires at that same time as the rest of the farm bill it cannot be addressed in the next Farm Bill debate.

To read the full text of the draft proposal (pdf format), go to:

House Committee on Agriculture web site