Mid-March and early April were active periods for NMPF on the trade front.

On March 18, Wisconsin dairy farmer and NMPF Board member Pete Kappelman testified on Capitol Hill about the need for favorable free trade agreements to sustain dairy export growth. The next day, NMPF joined major national and international dairy groups in stressing the importance of achieving favorable dairy market access in the Trans-Pacific Partnership.

Two weeks later, on April 2, NMPF joined the International Dairy Food Association and the U.S. Dairy Export Council in praising more than 75 House members who urged the Obama Administration to negotiate a strong market-access outcome for the U.S. dairy industry in the Pacific Rim trade agreement. The letter highlighted the need for a positive dairy result.

As head of NMPF’s International Trade Committee, Kappelman represented the federation at the mid-March House Agriculture Committee hearing on the importance of trade to agriculture. He noted that since 2000, U.S. dairy exports have increased 625 percent – to a record $7.1 billion – and that exports are now “critical to the health of my farm and our dairy industry at large.”

Kappelman, who is chairman of Land O’Lakes and a NMPF board member, said it is not a coincidence that this export growth occurred while the United States was implementing several free trade agreements, and that each of those was approved using Trade Promotion Authority.

Kappelman urged Congress to approve new TPA legislation in order to facilitate a favorable Trans-Pacific trade agreement.  The TPA legislation is expected to be introduced in Congress next week. “Significant access to TPP’s most protected dairy markets – Japan and Canada – is absolutely essential to us, and both of those countries have pointed to the importance of having TPA in place as TPP talks enter their final stage,” he said.

A day after Kappelman’s testimony, NMPF joined USDEC, IDFA, and national dairy organizations of Australia and New Zealand in pressing trade and agriculture officials of all three countries for “significantly increased dairy market access” with Japan and Canada in the Trans-Pacific Partnership negotiations.

In a joint letter, the organizations said TPP offered a historic opportunity to eliminate trade distortions and that access to the Japanese and Canadian markets should not be hindered by non-tariff barriers such as the European Union’s aggressive stance on geographical indications.

Earlier this week, NMPF, USDEC, and IDFA commended 75 House members for advising U.S. Trade Representative Michael Froman and Agriculture Secretary Tom Vilsack that “winning an overall positive market access result for the U.S. dairy industry is critical to the success of the TPP negotiations.”

The dairy groups said that dairy producers and processors agree on the importance of a balanced, positive TPP outcome for their industry and that Canadian and Japanese dairy market barriers must be addressed in any final TPP agreement.

NMPF thanked West Virginia Governor Earl Ray Tomblin for vetoing legislation April 2 that would have allowed consumers in that state to obtain unpasteurized milk through herd-shares. NMPF urged a veto of SB 30 in a joint letter with the International Dairy Foods Association in March.

“NMPF and the nation’s dairy farmers appreciate that Governor Tomblin sided with public health experts over raw milk advocates,” said NMPF President and CEO Jim Mulhern. He urged legislatures in at least six other states with pending raw milk bills to follow West Virginia’s lead.

“The link between consuming raw milk and foodborne illness has been well-documented, with evidence spanning nearly 100 years,” Mulhern said. “At the same time, no claims of additional health benefits from drinking raw milk over pasteurized milk have been substantiated.”

NMPF has led the dairy industry in opposing efforts to make raw milk more accessible to consumers. Unpasteurized milk is a key vehicle in the transmission of pathogenic bacteria including E. coli 0157:H7, Campylobacter, Listeria monocytogenes, and Salmonella.

NMPF has urged the Departments of Agriculture and Health and Human Services to continue recommending at least three servings of dairy a day as part of the 2015 Dietary Guidelines for Americans.

At a March 24 hearing, Vice President of Dairy Foods & Nutrition Beth Briczinski reminded the agencies of dairy’s nine essential nutrients and that three of four nutrients lacking in the American diet are found in milk.

“Knowing that the nutrient package of dairy foods is virtually irreplaceable in the diet,” Briczinski said, “and that dairy consumption averages less than two servings a day, the Dietary Guidelines should at least continue to recommend three servings of dairy and, preferably, recommend Americans increase their current consumption of dairy foods.”

“Most Americans would certainly benefit by adding one more serving of nutrient-dense dairy foods each day,” Briczinski added. “This would go a long way toward improving essential nutrient intakes and help consumers achieve better diets and better health.”

Briczinski testified during a public hearing on the proposed Guidelines. The final 2015 Dietary Guidelines for Americans will be issued later this year.

In March, Cooperatives Working Together helped its member cooperatives contract to sell 14.4 million pounds of American-type cheese and 5.9 million pounds of butter.

When added to sales contracted in January and February, the March sales bring the year to date 2015 totals to 23.1 million pounds of cheese and 24.3 million pounds of butter. Together, those sales will send the equivalent of 764 million pounds of milk on a milkfat basis to customers in 22 countries on five continents through September 2015.

Developed by NMPF, CWT is a voluntary export assistance program supported by dairy farmers producing 70 percent of the nation’s milk. By moving U.S. dairy products into world markets, CWT helps keep domestic inventories and dairy farmer milk prices at reasonable levels.

NMPF’s latest Activities and Accomplishments Report is available on the organization’s website. Published annually, the report is an account of NMPF’s actions and achievements on all the issues it faced in the previous year.

The 2014 report covers the enactment and implementation of the Margin Protection Program – the most significant rewrite of federal dairy policy in a generation – as well as NMPF’s efforts to press dairy-friendly policies in the areas of trade, immigration, the environment, and food safety. In addition, it covers efforts to strengthen NMPF’s animal care program, rejuvenate the REAL® Seal, and continue the export assistance program Cooperatives Working Together, which played a key role in helping U.S. farmers amid 2014’s steep, worldwide dairy price decline.

In an introduction to the report, President and CEO Jim Mulhern said NMPF last year “achieved precisely the focus, effort, and accomplishments that I had in mind when I became President.”

The joint annual conference of the American Butter Institute and the American Dairy Products Institute will be held Sunday through Tuesday, April 26 – 28, at the Hyatt Regency in Chicago.

One of the premier events of the year for butter and dairy ingredient marketers, the conference will cover topics including the challenge of nourishing a growing world population and the 2015 Dietary Guidelines for Americans, the government’s primary nutrition advice for consumers. Panelists will include Janet Raddataz of Sargento Foods, Greg Miller from the National Dairy Council, and Tim Hunt from Rabobank. Also on the agenda are board meetings for both ABI and ADPI and a recognition lunch that will honor the 2015 ADPI Award of Merit winner and the Jim Page Memorial Scholarship recipient.

The meeting offers networking opportunities with more than 1,000 senior executives from manufacturers, marketers, suppliers, distributors and brokers of manufactured dairy products, as well as industry analysts, journalists, and key government officials. Registration is through the ADPI website.

The Animal Agriculture Alliance will hold its 2015 Stakeholders Summit in Kansas City on Wednesday and Thursday, May 6-7. Dairy producers interested in attending can register through the organization’s website.

Speakers will include Brad Scott, a partner in Scott Brothers Dairy Farms in Chino, California, who was featured in the television show Undercover Boss, and Dennis Dimick, executive editor of National Geographic, who oversaw the magazine’s 2014 Future of Food series. Returning from last year are Jeff Fromm, author of Marketing to Millennials, and Feedstuffs’ Andy Vance as moderator.

The Animal Agriculture Alliance helps consumers understand modern animal agriculture and seeks to expose those who spread misinformation about the industry. Jamie Jonker, NMPF Vice President of Sustainability & Scientific Affairs, serves on its board.

The dairy industry today praised the more than 75 House members who have urged the Obama Administration to negotiate a strong market-access outcome for the U.S. dairy industry in the Pacific Rim trade agreement.

Led by the co-chairs of the Congressional Dairy Farmer Caucus, the House members sent a bipartisan letter to U.S. Trade Representative Michael Froman and Agriculture Secretary Tom Vilsack, saying Canadian and Japanese dairy market barriers must be addressed in any final Trans-Pacific Partnership (TPP) agreement to allow more U.S. dairy exports. The TPP involves trade negotiations between the United States and 11 other nations.

“We recognize that you must juggle a wide range of priorities,” the congressmen said in the letter. “However . . . we believe that winning an overall positive market access result for the U.S. dairy industry is critical to the success of the TPP negotiations.”

The National Milk Producers Federation, the U.S. Dairy Export Council and the International Dairy Foods Association commended the House members’ action, noting that dairy producers and processors agree on the importance of a balanced, positive TPP market-access outcome for their industry.

“The U.S. dairy industry has a $4 billion trade surplus worldwide and supports tens of thousands of jobs here at home, yet we still face substantial hurdles in major markets,” said Tom Suber, USDEC president. “TPP should expand our ability to compete through new access and more fair rules of trade.”

“The U.S. cannot give a pass to major countries like Canada and Japan while at the same time increasing access for major competitors into our own market. That is completely unacceptable,” said Jim Mulhern, NMPF president and CEO. “Given that TPP is likely to introduce more competition in a number of key markets, the bottom line is that this agreement must result in a net boost in export opportunities for U.S. dairy producers.”

Connie Tipton, IDFA president and CEO, added, “Significant market access for all dairy products must be on the table in negotiations with Japan and Canada. If this is to be a true 21st century trade agreement, U.S. dairy exporters should not be limited on what they sell into these markets.”

A majority of the House members signing the letter have voted in support of at least one of the U.S. free trade agreements approved in 2011, which are the most recent to date. Spearheading the letter were the Congressional Dairy Farmer Caucus co-Chairs: Reid Ribble (R-WI), Peter Welch (D-VT), Joe Courtney (D-CT), Suzan Delbene (D-WA), Tom Reed (R-NY), Michael Simpson (R-ID), David Valadao (R-CA) and Timothy Walz (D-MN). Read the letter here.

 

The National Milk Producers Federation, based in Arlington, Va., develops and carries out policies that advance the well-being of U.S. dairy producers and the cooperatives they collectively own. The members of NMPF’s cooperatives produce the majority of the U.S, milk supply, making NMPF the voice of nearly 32,000 dairy producers on Capitol Hill and with government agencies.

The U.S. Dairy Export Council is a non-profit, independent membership organization that represents the global trade interests of U.S. dairy producers, proprietary processors and cooperatives, ingredient suppliers and export traders. Its mission is to enhance U.S. global competitiveness and assist the U.S. industry to increase its global dairy ingredient sales and exports of U.S. dairy products. USDEC accomplishes this through programs in market development that build global demand for U.S. dairy products, resolve market access barriers and advance industry trade policy goals. USDEC is supported by staff across the United States and overseas in Mexico, South America, Asia, Middle East and Europe. The U.S. Dairy Export Council prohibits discrimination on the basis of age, disability, national origin, race, color, religion, creed, gender, sexual orientation, political beliefs, marital status, military status, and arrest or conviction record. www.usdec.org

The International Dairy Foods Association, Washington, D.C, represents the nation’s dairy manufacturing and marketing industries and their suppliers, with a membership of 550 companies within a $125-billion a year industry. IDFA is composed of three constituent organizations: the Milk Industry Foundation, the National Cheese Institute and the International Ice Cream Association. IDFA’s nearly 200 dairy processing members run nearly 600 plant operations, and range from large multi-national organizations to single-plant companies. Together they represent more than 85 percent of the milk, cultured products, cheese, ice cream and frozen desserts produced and marketed in the United States. IDFA can be found online at www.idfa.org.

The National Milk Producers Federation today thanked West Virginia Governor Earl Ray Tomblin for vetoing legislation allowing consumers to obtain unpasteurized milk through herd-shares, or arrangements under which they become part owners of a dairy cow. Tomblin said the bill posed “a serious risk to public health.”

“The link between consuming raw milk and foodborne illness has been well-documented, with evidence spanning nearly 100 years,” said NMPF President and CEO Jim Mulhern. “At the same time, no claims of additional health benefits from drinking raw milk over pasteurized milk have been substantiated. NMPF and the nation’s dairy farmers appreciate that Governor Tomblin sided with public health experts over raw milk advocates in rejecting SB 30.

“Endangering public health is no way for any state to operate and we appreciate Governor Tomblin heeding that message,” Mulhern added. “At least six other state legislatures have bills pending that would ease raw milk sales to consumers. We urge them to follow West Virginia’s lead and reject these measures.”

The state legislature sent Tomblin SB 30 late last month. NMPF, the voice of 32,000 dairy farmers nationwide, urged a veto in a joint letter with the International Dairy Foods Association, which represents dairy processors.

Tomblin announced his veto today, saying that consuming raw milk “has inherent dangers and  . . . is particularly dangerous to children, pregnant women, and persons with compromised immunity.” Currently, no form of raw milk sales are permitted in West Virginia.

NMPF has led the dairy industry in opposing efforts to make raw milk more accessible to consumers. Unpasteurized milk is a key vehicle in the transmission of pathogenic bacteria including E. coli 0157:H7, Campylobacter, Listeria monocytogenes, and Salmonella.

 

The National Milk Producers Federation, based in Arlington, VA, develops and carries out policies that advance the well being of dairy producers and the cooperatives they own. The members of NMPF’s cooperatives produce the majority of the U.S. milk supply, making NMPF the voice of more than 32,000 dairy producers on Capitol Hill and with government agencies.

You don’t have to be a craftsman to understand the adage that when the only tool you have is a hammer, every problem looks like a nail. This type of reductionist thinking can affect many businesses, not just carpentry, but whenever such a thought process is applied, it distracts people from actually solving issues because their attention is focused on the wrong problem – and hence, the wrong solution.

A recent case in point is critical comments from some quarters regarding the venerable Federal Milk Marketing Order system. Clearly, the system isn’t perfect, and in fact, is in need of some change. However, we have to be very careful when evaluating any fixes that we don’t take a hammer to FMMOs when they are not the real source of the problem some want to repair.

One of the periodic concerns we’ve heard from dairy processors, particularly in the past year, is that the industry has experienced more price volatility in recent years. Markets at home and abroad have been seemingly moving more quickly, and less predictably, than ever before. In the case of 2014, farm-level milk prices reached levels never before seen. For dairy buyers, a $25 per hundredweight all-milk price last year was a tough pill to swallow. Of course, when prices are much lower, as they were in 2012 and are again in 2015, it’s the farmers who have reason to complain.

The truth is that last year’s high prices were not unique to the U.S., and certainly were not due to the federal milk order system. With over 15 percent of U.S. milk production now moving into world markets, we all recognize that our industry is more fully integrated with the world dairy trading system. The weather in New Zealand affects milk production there, and their problems can push up milk prices elsewhere around the world. Chinese demand has the same effect. Meanwhile, terrific weather last year in our Corn Belt affected global grain prices by pushing them down.

Any potential changes to Federal Orders are not going to magically wipe away the prospect of global and unpredictable price movements. Since dairy is by its nature a relatively price inelastic product, minor swings in production and consumption can create big swings in price. It is important to recognize that reality, because as we sell more into the world market, this will be the norm in the future.

The fact is that monthly-announced classified pricing actually sands off some of the rough edges of price volatility. While cash commodity markets, and the futures markets for Class III and IV prices, trade daily, the Federal Order price minimums change only monthly. That actually acts as a modifier of erratic, shorter-term price changes. While the monthly NASS-based price formulas woven into FMMOs have their own set of issues that need addressing, price volatility could actually accelerate in the absence of a monthly price formula calculation.

One of the ironies of all this discussion right now is that California’s dairy farmers are seeking to replace their state marketing system with the federal one. Dissatisfied with what many see as the state’s failure to update its program to address pricing imbalances, several farmer-owned cooperatives in California are now petitioning to create a Federal Order for their members. That’s a strong signal to me that Federal Orders are a relevant, and necessary, dairy policy mechanism in the 21st century.

The key issue with any policy is to continue monitoring and evolving it to keep up with changing conditions. We certainly see a need to reassess the issue of make allowances and end product price formulas, for example. They were included in the FMMO reform package in the late 1990s as a replacement for the old Minnesota-Wisconsin milk price, and haven’t been updated. And there are other changes also worth considering.

But let’s be clear: at its core, the Federal Order system is designed to ensure orderly marketing and protect dairy farmers from predatory pricing practices. Some dairy companies believe that reform is about ending the system, not mending it, and in the process providing farmers a smaller share of the consumer’s dairy dollar – a share that has been shrinking over time. That’s a non-starter for us. Our focus will be on reforms needed to strengthen – not weaken – Federal Orders so they continue to achieve their objective of benefiting producers and consumers by establishing and maintaining orderly marketing conditions.

Price volatility is a challenge for dairy farmers and processors alike. However, Federal Orders don’t create that volatility – market forces of supply and demand do. Thus, going after FMMOs with a hammer is not going to improve, or change in any meaningful way, the pricing pendulum. There are risk management tools available to help manage volatility. Let’s not use a hammer when the job at hand calls for a wrench.

Legislation Will Establish Labeling Guidelines to Help Farmers and Consumers

ARLINGTON, VA – The National Milk Producers Federation today praised the introduction of legislation in the House of Representatives that would establish federal standards for the safety and labeling of foods containing genetically modified organisms.

Under the bill, the Safe and Accurate Food Labeling Act, the Food and Drug Administration will set standards for companies that wish to label their products as containing or not containing GMOs. The legislation was introduced by a bipartisan group of lawmakers led by Reps. Mike Pompeo (R-KS) and G.K. Butterfield (D-NC). Rep. Pompeo introduced similar legislation in the House last year.

“Rather than create a confusing patchwork of state policies, the legislation would deal with this issue at the national level,” said Jim Mulhern, President and CEO of NMPF. “It would improve clarity in foods carrying a GMO-free label by establishing uniform rules and a national certification program for foods that have been produced without bioengineering.”

GMOs have been proven safe by nearly 2,000 studies from the leading scientific bodies in the world, including the World Health Organization and the American Medical Association. Agencies including the FDA, the U.S. Agriculture Department, the National Academy of Sciences, and the World Health Organization have found no negative health effects from consuming GMOs.

“Due to the complexity of the American food chain, state-by-state labeling is not an option,” Mulhern said. “The additional costs would be passed on to consumers, and many family-run businesses, including dairy farms, would be unable to navigate these new hurdles.”

There is no need for mandatory labeling of foods made with GMO process or ingredients, “but if food marketing companies wish to voluntarily label their products as being free of GMOs, this legislation establishes a national protocol for doing so,” Mulhern said.

Currently, up to 80 percent of the food available in the United States contains genetically modified ingredients.

 

The National Milk Producers Federation, based in Arlington, VA, develops and carries out policies that advance the well-being of dairy producers and the cooperatives they own. The members of NMPF’s cooperatives produce the majority of the U.S. milk supply, making NMPF the voice of more than 32,000 dairy producers on Capitol Hill and with government agencies.