The focus on the Farm Bill has been on the commodity title, but the recently advanced Senate Ag Committee bill also contains reform in US dairy policy. Chuck Conner, with the National Council of Farmer Cooperatives which represents many dairy co-ops, says the dairy section of the Farm Bill is a step in the right direction. He said it will help dairy producers continue to grow dairy exports, “The new policies in the Farm Bill reflect the dairy industry becoming more focused on markets, particularly international markets.” Currently, dairy exports account for about 15% of dairy product demand.
Conner told HAT the goal of the new policy is to provide some economic stability to the dairy market and give producers a way to deal with extreme price volatility. He said, going forward, the market will provide great economic opportunity for dairy producers, but also great risk, “Our policy must provide a safety net for when the volatility drops dairy prices to very low levels.” The Senate legislation includes a new, voluntary, margin protection program endorsed by the National Milk Producers Federation (NMPF) meant to safeguard farmers against disastrously low margins, such as those generated by the low milk prices and high feed costs that cost dairy farmers $20 billion in net worth between 2007 and 2009.
While many dairy organizations support the Senate approach some do not. “The Senate has taken a huge step in the right direction by including the dairy reforms modeled after NMPF’s Foundation for the Future program,” said Jerry Kozak, President and CEO of NMPF. But the International Dairy Foods Association, which represents dairy processors, expressed disappointment over the developments. IDFA is opposed to measures that would restrict the supply of milk to processors, according to Jerry Slominski, senior vice president for legislative and economic affairs for the IDFA.
Conner, a veteran of 6 farm bill debates, says the Senate will likely pass a Farm Bill this year, but he is less optimistic about the House passing a bill in 2012. The battle over dairy policy is just one of many issues that will slow progress of both the Senate and House versions of the bill.
[audio:https://www.hoosieragtoday.com//wp-content/uploads//2012/04/dairyfarmbill.mp3|titles=Coops Support Farm Bill Dairy Plan]