News for Dairy Co-ops - December 5, 2013

Volume 71. No. 12

Newsletter Stories

Congress Still Trying to Finish Farm Bill Before Christmas

The leaders of the House and Senate Agriculture committees continue to negotiate this week on a number of issues to break the impasse over the long-pending farm bill. Those differences include the final shape of an updated federal dairy program, but also range from the level of food stamp cuts, to conflicts between row crop producers in various parts of the country. 

The Senate will not formally return to Washington until next week, while the House is scheduled to adjourn for the year next Friday. Talk continues to grow about the need for a short-term extension of current policies to stave off the implementation of permanent agriculture law, and with it the dairy “cliff” of higher price support levels for milk and other commodities. NMPF continues to urge farm bill conferees to finish their work in the coming weeks so that pressure for a long-term extension of a year or more doesn’t gain any traction. Farmers can use NMPF’s Dairy GREAT system to urge Congress to support the dairy provisions in the Senate bill.

Meanwhile, NMPF last week circulated a new analysis of the House and Senate dairy plans, which showed the Senate language backed by NMPF will cost $100 million less over 10 years than the House program, which is backed by dairy processors.

The analysis, by the nonpartisan Congressional Research Service, was the first to directly compare the House and Senate versions of the farm bill. It put the 10-year cost of the Senate dairy program at $302 million above current programs, and the House language $418 above that so-called “baseline.”

Incoming NMPF President Jim Mulhern said the analysis, while conservative, buttressed NMPF’s point that the final dairy program needs to couple margin insurance with a market stabilization program that caps costs. That is essentially the Senate plan.

“Without the market stabilization program to both reduce the duration of low margin conditions, and reduce government outlays … the House plan would be a budget-buster—and one that we urge the conferees to reject,” Mulhern said.

Mulhern also criticized attempts to distort an earlier analysis to show that consumer prices will increase under the Senate program. The earlier analysis was done by University of Missouri agricultural economist Scott Brown.

“The purpose of market stabilization is to keep farmers’ milk prices from staying too low, for too long,” Mulhern said. “Any suggestion that it will spike retail prices to abnormally high levels is a deceitful and deliberate misinterpretation of the studies done on the impact of the (two bills).” In the Brown analysis, the average difference in farm milk prices between the two approaches was only two cents per gallon over four years, not enough to significantly impact retail prices.

1,000 Industry Leaders Wish Jerry Kozak Well, Welcome Successor at NMPF Annual Meeting

Dairy industry leaders from across the country converged on Phoenix for four days in mid-November to bid an emotional goodbye to outgoing NMPF President Jerry Kozak (left, with Mooney), and to hear incoming President Jim Mulhern’s vision for the organization’s future. The occasion was NMPF’s 2013 annual meeting, held jointly with the National Dairy Promotion and Research Board and the United Dairy Industry Association.

The meeting also featured a major policy speech by NMPF Board Chair Randy Mooney, and an expanded Town Hall in which 800 dairy farmers heard presentations on a long list of industry issues. In addition, six new board members were elected to the NMPF board, and the organization announced the name selected for the cartoon character it is using to help revitalize the dairy REAL® Seal.

In all nearly 1,000 people attended the meeting at the Arizona Biltmore Hotel. Headline speakers were former NFL head coach Herman Edwards, and organizational change expert Peter Sheahan. Agri-Talk Radio host Mike Adams was master of ceremonies, and up-and-coming country music star James Wesley provided banquet entertainment. Wesley (left) clearly enjoyed performing for a large group of farmers.

The meeting’s emotional highlight came when Kozak, president and CEO since 1997, thanked those with whom he has worked in the past 16 years, and turned the reins of the organization over to Mulhern.

Kozak will be formally replaced as president January 1 by current Chief Operating Officer Jim Mulhern, a Wisconsin native who has worked for the dairy industry in various capacities for three decades. During his remarks, Mulhern urged farmers to become more engaged in both NMPF and the policymaking process.

“We need your financial commitment, yes,” he said, “but even more importantly, we need your time and effort and engagement. The more engagement our members have … the more our organization can achieve for our members. It’s a virtuous circle.”

Mulhern also stressed the need for more communication by the dairy industry. “We must tell our story,” he said, “because if we don’t, others—who don’t have our interest at heart—are telling a very different, and harmful, story.”

On other subjects, Mulhern (left) said once the 2013 farm bill is enacted, NMPF should tackle reform of the federal milk marketing order system and consider addressing some changes to federal identity standards for dairy foods—but only if the changes benefit farmers. “Some of the dairy processors talk about reforming federal milk orders when what they really seem to mean is increasing their control of the market and their share of the dairy dollar,” he said. “That’s a non-starter for us. Our focus will be on reforms needed to ensure the orderly marketing of milk and to protect the financial interests of the nation’s dairy farmers.”

Mulhern noted that some in the processing community are also calling for changes to the federal standards that protect the content and quality of dairy foods. But, he said, sometimes this talk is delivered by those who either don’t understand the concept of standards of identity or those who are looking for a way to benefit financially through deviations marketed as “innovations.”

“Are there some provisions of standards that could be improved? Absolutely, especially if they relate to improvements and efficiencies in plant-level processing technologies,” Mulhern said. “However, NMPF will not agree to revisions to standards designed to ‘water down’ their quality or deceive consumers, and we will continue to work diligently to preserve all aspects of standards that preserve the integrity of traditional dairy products, their names and their composition.”

Board chair Randy Mooney (left) delivered his speech  as a House-Senate conference committee was working in Washington on a final, compromise version of the 2013 farm bill. Mooney blasted the House bill’s proposed dairy provisions as costly to taxpayers, a bonanza for processors and not what’s needed to help farmers.

Mooney said the House provisions would create conditions reminiscent of the early 1980s, when the federal dairy safety net was far too generous. In those days, he said, farmers produced more milk than the market could absorb and the government became their biggest customer.

Today, Mooney said, we are in danger of repeating history because some in Congress are forgetting the lessons of the past. “It’ll be cheap milk for processors, with taxpayers on the hook to keep the insurance money flowing,” he said. “And mark my words: If this approach were adopted, it would be the first, and last time, that a farm bill features this type of program. It’s just not built on a sound financial footing.”

The Town Hall, a tradition at NMPF annual meetings, kept attendees engaged throughout the four-hour session. Attendees heard presentations from NMPF staff on a long list of issues, which included the environment, trade, GMOs, food standards, and residue testing, in addition to the farm bill and immigration reform.

The following individuals were elected to serve as NMPF officers for 2014:

  • Randy Mooney, Dairy Farmers of America – Chairman
  • Ken Nobis, Michigan Milk Producers Association – First Vice Chairman
  • Adrian Boer, Northwest Dairy Association – Second Vice Chairman
  • Mike McCloskey, Select Milk Producers, Inc. – Third Vice Chairman
  • Dave Fuhrmann, Foremost Farms USA – Secretary
  • Doug Nuttelman, Dairy Farmers of America – Assistant Secretary
  • Pete Kappelman, Land O’Lakes, Inc. – Treasurer
  • Neal Rea, Agri-Mark – Assistant Treasurer (who is new to the officer group)

The following new board members were elected to serve on the NMPF board for 2014:

  • Michael Anderson, Farmers Cooperative Creamery
  • David Cooper, FarmFirst Dairy Cooperative
  • Kelly King, FarmFirst Dairy Cooperative
  • Peter Janzen, Land O’Lakes, Inc.
  • Tom Pittman, Premier Milk, Inc.

Also at the meeting, NMPF unveiled the new name for the animated REAL® Seal character: DairyUS. It was selected in a nationwide online content in which nearly 800 votes were cast. DairyUS received 379 votes.

The animated character, based on the iconic REAL® Seal logo, will help a new generation of consumers distinguish between genuine U.S. dairy products and a growing list of list of imitations. A video announcing the name is on the REAL® Seal website homepage.

Also at the annual meeting, NMPF offered a preview of the REAL® Seal buyer’s guide, a web-based search engine that will make it easier for consumers to patronize brands and stores that offer real dairy products. The buyer’s guide website will soon be online.

More information from the annual meeting is available online, including speeches and presentations, and photos.

CWT Assists with 14.8 Million Pounds of Cheese and Butter Sales in November

Even though the program only received requests for export assistance for a few weeks in November due to the NMPF Joint Annual Meeting and the Thanksgiving holiday, Cooperatives Working Together (CWT) provided assistance on 47 sales of cheese and butter totaling 14.8 million pounds. The accepted requests included 3 million pounds of butter (1,362 metric tons) and 11.8 million pounds of cheddar, Gouda, and Monterey Jack cheeses. The product will go to 16 different countries and will be delivered between November 2013 and May 2014.

Through November, CWT-assisted exports of butter totaled 87.9 million pounds (39,879 metric tons) and 121.9 million pounds of cheddar, Gouda, and Monterey Jack cheeses. The product is going to 40 different countries on six continents. With the Milk Income Loss Contract (MILC) expired as of September 30, 2013, and the farm bill in limbo, CWT is the only program actively providing support to America’s dairy farmers.

In membership news, Tillamook County Creamery Association (TCCA), headquartered in Tillamook, Oregon, joined the 37 other cooperatives in supporting CWT’s export assistance effort.

TCCA has approximately 100 member-owners and manufactures a variety of cheeses and other branded dairy products, including: Cheddar, Cheddar Cheese Curds, Monterey Jack, Reduce Fat Monterey Jack, Hot Habanero Jack, Colby, Colby Jack, and Pepper Jack. Other cheese varieties include Swiss, Smoked Swiss and Baby Swiss; Muenster and Provolone. They also manufacture a line of premium ice cream, yogurt, sour cream, butter, whey, and WPC 34 from the two plants that they operate - one in Tillamook and the second in Boardman, Oregon.

The CWT Committee representative from TCCA will be Mark Wustenberg, vice president of quality and operations.

Pan-American Dairy Federation Opposes EU Over-Reach on Geographical Indications and EU Attempts to Restrict Common Food Names

Through its work in the Consortium for Common Food Names (CCFN), NMPF has continued to support efforts to preserve market access for U.S. cheeses in several Latin American countries and continues to monitor the situation globally.

Most recently, FEPALE, the Pan-American Dairy Federation (Federación Panamericana de Lechería), passed a resolution in opposition to the European Union’s (EU) increasing efforts to restrict the use of common food names. FEPALE represents the vast majority of countries throughout the Americas. The resolution was passed by FEPALE’s board during the group’s Annual meeting in Panama City, Panama on November 21.

The EU has been working aggressively within its trade agreements in Latin America and other nations to restrict the use of food names, including such common cheese names as “parmesan,” “asiago,” “gorgonzola” and “feta.”

The resolution notes that the EU’s efforts to lay sole claim to numerous terms in widespread usage globally would have “significant negative impacts on FEPALE members,” and pose a “global threat to trade and commerce.” The original Spanish version can be found here, and a translated copy is available here.

NMPF agrees with CCFN that there is a place for the protection of certain foods from distinct regions, such as Napa Valley wines or Camembert de Normandie cheese from France, but the EU has pushed the bounds of geographical indication protections to include generic names, forcing countries to accept their demands. NMPF will continue its work to combat this threat to U.S. dairy sales.

Members concerned about this issue and interested in getting additional information can contact Shawna Morris at smorris@nmpf.org.

NMPF Welcomes New Staff Member

Brenda Rowe (left) recently joined NMPF as Executive Assistant to the President & CEO. As Executive Assistant, she will support NMPF by managing activities related to the President’s office.

Brenda has over 16 years of Executive Assistant experience and over four years of association experience. She worked four years at the Color Pigments Manufacturers Association as Executive Assistant, which covered a variety of roles in meeting planning, office management, accounts receivable, membership services, and assisting the Board and President.

Brenda is married and has a son in college, and currently resides in Alexandria, Virginia. She can be reached at browe@nmpf.org.

CEO’S CORNER


Jim Mulhern
NMPF President & CEO
Associate Member Focus: 

Agropur Cooperative is a Canadian dairy cooperative. It processes roughly 793 million gallons of milk in 27 plants spread throughout Canada, the United States, and Argentina for their 3,300 plus member dairy farmers. They also offer 12 different product lines ranging from cheese, milk, butter, and yogurt, generating more than $3.6 billion in sales annually.

Agropur continues to build on the vision of its pioneers. This organization with humble roots has remained faithful to cooperative values and today is a leader in the Canadian dairy industry. For over seven decades, Agropur has served consumers with outstanding reliability, providing them with a complete line of dairy products.

Agropur’s contact is Robert Coallier, Chief Executive Officer. To learn more about Agropur, please visit their website at www.agropur.com.