Author: Theresa Sweeney

2021 Holds Promise – and a Big To-do List

Posted on by Theresa Sweeney

It would be very difficult to exaggerate the extent of the challenges that the dairy industry, and the nation, has faced in the past year – and those challenges are far from over. But it’s also true that the promise of 2021 shouldn’t be underestimated. A new Congress and a new administration are getting to work. With bipartisanship perhaps more important than ever, it’s crucial that policymakers share a genuine desire to get beyond present difficulties and hit the ground running.

At the National Milk Producers Federation, that’s exactly what we are doing.

Our spirit of getting things done ranges across efforts in advancing legislation, regulatory policies, trade initiatives, and on-farm best practices. Here’s a glimpse of just a few things we’re working on.

In the new Congress, we’ll of course seek to advance dairy’s needs within COVID-19 relief legislation. Even as the stimulus passed late last year begins implementation, more assistance has been proposed. We will examine the need for additional resources as the legislative process unfolds.

Child nutrition programs are up for reauthorization, offering a chance to maintain and expand dairy options in school meals and build upon the strong reaffirmation of dairy’s nutritional value in the latest Dietary Guidelines for Americans. That recognition creates potential opportunities to improve school milk offerings, and the emphasis on nutrition also helps us with the anticipated re-introduction of the Dairy PRIDE Act, which would make FDA clear up consumer confusion over the nutritional content of dairy versus plant-based products.

Agricultural labor is already on Congress’s mind, with the new Biden administration’s plan to be active on broader immigration reform. All of agriculture continues to need legislation that provides permanent legal status for current workers, and dairy needs a guest worker program that meets its unique needs as a year-round perishable product, a high volume of which comes from operations that use immigrant labor.

Climate-related legislation is another near-certainty. That will give dairy the opportunity to advance the goals of the Net Zero Initiative that NMPF and partners launched in 2019 to reduce the sector’s carbon emissions to net zero by 2050 and improve water quality. Infrastructure or tax legislation may provide helpful vehicles for changes such as an Investment Tax Credit for nutrient separation technologies that would address water quality challenges, or to incorporate bipartisan legislation introduced last year that would remove barriers to farmer participation in environmental markets.

And all of this sets the stage for the 2023 Farm Bill, which may see field hearings and stakeholder discussions as soon as next year. That will entail a review of the Dairy Margin Coverage program and other risk management tools.

While we seek advances in Congress, we will also be working with the new administration to make sure that gains from the past four years are secured and that dairy continues to advance, domestically and internationally. Tops among trade concerns will be enforcing the US-Mexico-Canada agreement, particularly regarding Canadian dairy policies and Mexican technical standards and the treatment of common cheese names.

Restoring export growth to China through full implementation of the Phase 1 U.S.-China trade agreement and ending market-damaging retaliatory tariffs on U.S. dairy exports to China will also be important. The U.S. additionally needs to reenter the Trans-Pacific Partnership, and/or negotiate comprehensive, market-opening trade agreements with key Asian markets such as Japan, Vietnam, Philippines, as well as the UK, Kenya, and many others.

NMPF, along with its partner the U.S. Dairy Export Council, will continue to encourage science-based guidelines in multilateral organizations, including Codex, FAO, WHO and the United Nations. U.S. officials will also need to address long-entrenched regulatory barriers in the European Union while countering EU Geographical Indication (GI) policies that infringe on U.S. companies’ use of common food names in markets around the world.

Domestically, the regulatory front will be active. Dairy may need to defend gains made through the Navigable Waters Rule, which last year provided common-sense solutions to waterways regulation but may be under threat. Potential rules regarding PFAS chemicals will continue to pose challenges, as will calls to include dairy farms in the FDA’s Intentional Adulteration rule, needlessly adding more red tape to farmers’ lives. All of these efforts in Washington and worldwide touch the farms owned by producers in NMPF member cooperatives – and on the farm itself, we’re also striving for effective support.

While the USDA potentially approves manufacturing for the first Food and Mouth Disease vaccine in the U.S. and implements requirements to enhance the national FMD vaccine bank, a USDA grant makes NMPF the leader in efforts to bring enhanced biosecurity and the government’s Secure Milk Supply Plan into the National Dairy Farmers Assuring Responsible Management (FARM) Program.

In protecting against Bovine Tuberculosis, NMPF is also leading a multi-stakeholder task force with USDA to develop best practices to minimize animal-to-human and human-to animal-transmission.

And with FDA beginning to phase out remaining over-the-counter antibiotics for livestock production, NMPF and FARM will remain a resource for best practices of how to manage the new environment. Opportunities abound to create a more environmentally and economically sustainable dairy industry as well: The Biden Climate Change initiative may create opportunities for carbon credit trading for farms, and that initiative could advance water quality trading as well. Meanwhile, FARM Environmental Stewardship this year is adding resources to support industry goals and continuing to promote high-caliber human resources and safety management for on-farm practices.

All these initiatives add up to an incredible array of efforts, ranging from global trade to local farms. But these are incredible times. By moving forward with clarity and dedication, we can make them better. While we will certainly face many challenges in the year ahead, dairy’s gains also promise to be many in 2021. We look forward to achieving that promise.

Mistrust Pervades Congress, But Progress Possible, NMPF’s Bleiberg Says

Posted on by Theresa Sweeney

Governing in 2021 is difficult, with a narrowly divided Congress and a new administration facing significant challenges, said Paul Bleiberg, NMPF’s senior vice president for government relations, in an NMPF podcast. Still, policy progress for dairy is possible, especially given the sector’s reputation for bipartisan cooperation, he said.

“The atmosphere on Capitol Hill is unlike anything I’ve ever witnessed before,” Bleiberg said. “There’s significant mistrust between the two parties right now. There’s a great deal of skepticism about what can be accomplished working together, and yet at the same time, a new administration trying to find its footing really during unprecedented times.”

“It’s possible that time heals a lot of things, and over the course of the next few weeks, people will get down to work,” Bleiberg said. “I think you’re starting to see a sense for that, but it starts off very heated.”

Bleiberg also discusses dairy’s policy gains in 2020 and how the government is already implementing coronavirus programs related to dairy approved in December, in the full podcast here. You can also find the podcast on Apple Podcasts, Spotify,  SoundCloud and iHeart Radio. Broadcast outlets may use the MP3 file. Please attribute information to NMPF.

 

Rising Dairy Consumption Providing Comfort in a Challenging Time

Posted on by Theresa Sweeney

The data is in, and in dairy’s corner of the world, it brings some comfort at a challenging time. Throughout the market ups and downs of the pandemic era, consumers love of dairy products has been a constant, even rising in 2020 from 2019 and once again proving that, despite these challenging times, a glass of milk remains as relevant as ever.

Retail dairy purchases, which jumped at the pandemic’s beginning, have remained elevated throughout the year.

With more meals being prepared at home, dairy has provided comfort in uncomfortable times. Baking went better with butter. Coffee was complemented with real dairy cream or half-and-half. Milk remained essential to family nutrition.

 

Milk Consumption Grew During Pandemic

Milk consumption itself saw gains across categories. Buttermilk use rose with the baking revival, organic and conventional volumes of fluid milk rose, and lactose-free milk saw increases comparable to those of plant-based beverages – which, despite the hype from the fake-milk marketers, is a comparably-sized market to that of lactose-free alone.

What’s beyond compare is just how much more milk sales grew relative to plant-based during the pandemic – nearly $1 billion in growth compared to less than $400 million for plant-based.

Dairy Beats Plant-Based Growth

Data sources for information above: IRI/DMI/MilkPEP/DFW/CMAB custom database for milk and cheese; syndicated database for other products, IRI DMI/MilkPEP/DFW/CMAB custom database, Total US Multi Outlet + Convenience

True, plant-based posted a larger percentage gain during the pandemic – it always does, because its totals build from a smaller sales base. But in sheer sales growth, plant-based beverages aren’t on the same playing field as milk.

Everyone has a lot going on these days, and little of it is easy. But good news is even more appreciated whenever it can be found, and the consumer embrace of the foods that really matter is a part of the “new normal” that shows signs of becoming … normal. It’s showing some staying power – just like the 24/7, 365-days-a-year dairy industry itself. We remain strong, and ready for what’s ahead. The data backs it up. So does the determination.

NMPF Calls for More-Equitable Class I Mover as Part of Push for Improved Dairy-Pricing

Posted on by Theresa Sweeney

The National Milk Producers Federation today called for changes to the so-called Class I fluid milk price mover to recover losses dairy producers have faced from the extreme price disruptions caused by the coronavirus pandemic, part of a suite of policies essential to advancing the well-being of dairy farmers and the entire industry in response to challenges brought to light by the COVID-19 pandemic.

“We are seeking consensus across the dairy industry for changes to the Class I mover that remedy economic damage to dairy farmers who have disproportionately suffered as a result of this pandemic,” said Jim Mulhern, President and CEO of NMPF, after a meeting of NMPF’s Executive Committee on Friday to discuss policy approaches. “The intent behind the current mover was a revenue-neutral solution to the concerns of fluid milk processors about hedging their price risk. With that balance severely upended due to the pandemic, a modified approach is necessary. We need a solution that provides more equity and balance between farmers and processors.”

The current Class I mover used to price fluid milk in federal milk marketing orders took effect in 2019. It applies a $0.74/cwt adjuster to the monthly average of Class III and IV prices. That replaced the previous Class I formula, which was based on either the Class III or IV price each month, whichever was higher – an approach that worked for farmers but made it more difficult for fluid milk handlers to hedge milk prices using the futures market. The 2019 change was intended to be revenue-neutral and was widely supported across dairy when it was implemented. But the significant gap between Class III and IV prices that has developed during the pandemic has exposed dairy farmers to asymmetrical losses not experienced by processors.

Dairy farmers may lose roughly $800 million in revenues under the current Class I mover, making its re-examination necessary.

NMPF’s Executive Committee on Friday supported a motion directing the organization to explore, with other industry stakeholders, updates to the pricing formula that better protect dairy producers. The committee also discussed other dairy-pricing improvements as part of an ongoing in-depth NMPF examination of important issues related to Federal Milk Marketing Orders. NMPF leadership directed staff to convene NMPF’s Cheese Pricing Task Force to further refine proposals involving both public and private sector organizations that could help address ongoing imbalances in the pricing of block and barrel cheese.

“These issues are challenging and complex, but also crucial to face if we are to best promote prosperity among dairy farmers, their cooperatives, and the entire industry,” Mulhern said.

Farmers Gain Improved Access to Small Business Support as PPP Reopens

Posted on by Theresa Sweeney

The National Milk Producers Federation is pleased that farmers who run their operations as sole proprietors, independent contractors, or otherwise self-employed individuals will have newly expanded access as soon as today to the Paycheck Protection Program (PPP) under changes made in the COVID stimulus package Congress approved last month.

Producers who were denied PPP loans or whose loan amounts did not consider self-employment compensation may now be eligible for the vital federal small business support. Eligibility information and more details can be found here. Those wanting to apply for a PPP loan should contact lenders directly for more information on when PPP will be open for that specific lender.

“NMPF is pleased that many of our dairy farmers will have fewer restrictions and limitations on the PPP support available to them as the program reopens this week,” said Jim Mulhern, NMPF’s president and CEO. “We have been grateful for the support already extended to dairy through PPP, and we deeply appreciate the improved access found in the latest stimulus package.”

Congress created PPP in the CARES Act in March of 2020 to help American small businesses keep employees during the coronavirus pandemic. Still, the program’s emphasis on payroll raised inadvertent yet sizable challenges for many farmers and ranchers who do not issue structured payroll — namely those operating as sole proprietors, independent contractors, or self-employed producers who file a Schedule F with their 1040 income tax form. The program’s loan application required such producers to use their net farm profit amount from their Schedule F tax form as a stand-in for their self-employment compensation when applying for a PPP loan. However, many farmers and ranchers filed a zero or negative net farm profit on their 2019 tax forms, effectually making them ineligible for the small business support.

NMPF worked successfully to advance legislation to help producers gain better access to PPP COVID relief, working closely with members of Congress leading on the issue. In June, Senators John Thune (R-SD) and Tammy Baldwin (D-WI) and Representatives Ron Kind (D-WI), GT Thompson (R-PA), Anthony Brindisi (D-NY), and John Joyce (R-PA) introduced the Paycheck Protection for Producers Act (S. 3918 and H.R. 7175). The bipartisan legislation allows farmers and ranchers who file a Schedule F to use their gross income, capped at $100,000, when applying for a PPP loan. The bill also permits producers who received a PPP loan based on their net farm profit to reapply with their gross income figure, with lenders allowed to offer the difference should the new loan amount be larger than the original amount.

The coronavirus relief measure enacted in December incorporated key provisions from the Paycheck Protection for Producers Act, securing for these farmers and ranchers increased access to the low-interest, forgivable loans.

All farmers and ranchers who file a Schedule F can apply or reapply for a PPP loan under the new rules once the program reopens. In general, agricultural producers and co-ops with 500 or fewer employees, including employees of businesses with which they have an affiliation, are eligible. Alternative size standards may qualify larger businesses, and interested larger borrowers are encouraged to explore options with lenders and/or their accountants. The Small Business Administration announced PPP would reopen in multiple stages beginning this week.

NMPF Statement on Electoral-Vote Certification and Condemnation of Insurrection at U.S. Capitol

Posted on by Theresa Sweeney

From NMPF President and CEO Jim Mulhern:

The National Milk Producers Federation congratulates incoming President Joe Biden and Vice President Kamala Harris, and we applaud the culmination of the democratic process achieved at the U.S. Capitol early this morning under previously unimaginable circumstances.

Yesterday’s reprehensible violence was an attack on our democracy, intended to undermine the results of a free and fair election and desecrate the sovereign will of the American people. Peaceful protest is a cornerstone of our society; yesterday’s insurrection put thousands of lives in danger in a brazen mob attempt to disrupt the peaceful transfer of power that has marked our country since its founding and has always set apart the United States as an example to the rest of the world.

We are grateful to the many professionals who kept our friends, colleagues and fellow citizens safe during this trying ordeal. We emphatically reject the rhetoric of elected officials whose words encouraged and perpetuated yesterday’s assault on our democracy. And we pledge to do our part to work with the Biden Administration and Congress to move our country forward this year, always supporting the democratic ideals that remain the foundation of these United States.

2021 Promises Better Days Ahead, Thanks to the Successes of 2020

Posted on by Theresa Sweeney

A new year brings new hope, and there are plenty of reasons for hope in dairy as 2021 begins.

The arrival of COVID-19 vaccines promises an eventual return to more-normal patterns of life — and less volatility in markets — at some point this year.

A new Congress and administration will provide opportunities to address important concerns – and dairy, with its proud tradition of bipartisanship, is uniquely positioned to seize those opportunities even in a divided government.

And dairy’s 2020 track record of accomplishment – led by the advocacy of the cooperative community from the beginning of the coronavirus crisis last March to the latest federal assistance package signed into law in late December – provides a formidable foundation to build from as we stay true to our mission of serving our members during the challenging, though in the end brighter, year ahead.

About those accomplishments. There hasn’t been much time to pause and reflect on how profoundly dairy rose to the occasion in 2020 — not in a 24/7, 365-day-a-year industry that never stops producing products and serving consumers. This crisis has evolved too quickly, and the needs have been too ever-changing and acute, for anyone to truly rest. But the gains that our members, and everyone in dairy, have made through tireless advocacy have been substantial. The COVID stimulus bill approved in December alone included:

  • $400 million for a new NMPF-backed Dairy Donation Program open to all producers to help dairy stakeholders and non-profits work together to provide dairy products to food-insecure households and minimize food waste.
  • Provisions enabling USDA to provide additional compensation to producers who earlier were unable to receive the full support they needed under the Coronavirus Food Assistance Program, which had payment limitations that didn’t fully address the extent of the damages incurred on many dairy farms.
  • Supplemental Dairy Margin Coverage (DMC) payments for farms whose DMC production history has increased since 2014, up to 5 million pounds. The provision is a boon for smaller operations and increases farm bill baseline spending for all dairy farmers through 2023, the life of the current law.
  • Improvements that will make the Paycheck Protection Program work better for sole proprietor, independent contractor, and self-employed dairy farmers by allowing them to use their 2019 gross income to determine their PPP loan amounts.

And of course, dairy farmers will be eligible for support in the $11 billion agricultural disaster assistance package, of which at least $1.5 billion is already being targeted to additional product purchases for distribution to food insecure individuals, included in the legislation Congress has passed.

It’s important to note that the stimulus bill was only the most recent in a string of policy successes that together have generated well over $5 billion in assistance to dairy producers and helped stabilize markets. It’s also important to remember that each success builds upon earlier ones.

For example, the progress on payment limits built on the earlier victory of getting dairy farmers more equitable treatment in payments made under the Coronavirus Food Assistance Program than they had received in earlier programs, like the trade-mitigation payments. Now, CFAP itself has been improved upon. And the supplemental DMC payments will set the stage to remedy a niggling flaw in the DMC’s coverage, that of an out-of-date production history that does not reflect farmers’ current situations. But the DMC was itself a major improvement on the old Margin Protection Program. And now participation in DMC will be even more fruitful for many producers.

Such gains only come from credibility, persistence, tireless effort and the patient building of relationships with key officials on Capitol Hill and in the administration. It’s the kind of work NMPF has prided itself on, day-in and day-out, throughout its existence – and it’s the dedication that shines through during times of critical need, like what we’ve seen in these past few months.

The year’s successes extend beyond legislation as well. Gains in trade policy helped enable a year of progress for U.S. exports, which data indicates may end up being a record year for the total volume of milk solids exported. Our FARM Program continues to lead in industry best practices. Our successful advocacy in regulatory issues has aided our farmers in the eternal struggle against red tape. And we’ve effectively communicated dairy’s story, to farmers and to the world, letting everyone know that this sector is essential, and resilient, and well-positioned to thrive.

The lessons learned in 2020 both prepare us, and brace us, for the days ahead. With normal times not yet here, 2021 certainly won’t be easy. The economy will remain touch-and-go. Partisanship may intensify. Longstanding issues like agricultural labor will remain difficult to resolve, and rising issues such as climate change will pose additional challenges.

But we’re energized by the challenge of serving our members even more effectively. We know we can do it, because we’ve seen the dairy community rise to meet its challenges throughout this past year. And together, we will create better days to come.

CWT Assisted December Sales Raise 2020 Exports to 1.1 Billion Pounds

Posted on by Theresa Sweeney

December’s CWT-assisted member sales of 13.9 million pounds of cheese, butter, whole milk powder and cream cheese raised the 2020 export sales to 35.7 million pounds of America-type cheeses, 14.8 million pounds of butter, 55.4 million pounds of whole milk powder, 2.8 million pounds of anhydrous milkfat and 7.3 million pounds of cream cheese.

An estimated 113 million pounds of CWT-assisted dairy products have been shipped out of the U.S. and into overseas markets in 2020. The milkfat equivalent of 1.105 billion pounds of milk have left U.S. shores for markets in 30 countries.

CWT in December assisted member cooperatives in securing 55 sales contracts for 3.2 million pounds of American-type cheeses, 2.3 million pounds of butter, 6.7 million pounds of whole milk powder, and 723,116 pounds of cream cheese. The products will be shipped during the months of December 2020 through May 2021. These sales raised the milk equivalent 2020 sales contracts total to 1.2 billion pounds of milk.

Assisting CWT member cooperatives gain and maintain world market share through the Export Assistance program positively impacts all U.S. dairy farmers by strengthening and maintaining the value of dairy products that directly impact their milk price. It does this by expanding the demand for U.S. dairy products beyond the domestic market thereby increasing the total demand for U.S. farm milk.

The amounts of dairy products and related milk volumes reflect current contracts for delivery, not completed export volumes. CWT will pay export assistance to the bidders only when export and delivery of the product is verified by the submission of the required documentation.

All cooperatives and all dairy farmers benefit from CWT’s activities and should add their support to this important program in 2021 and beyond. Membership forms for 2021-2023 are available at http://www.cwt.coop/membership.

FARM Continuing Quick Convos Series

Posted on by Theresa Sweeney

The National Dairy FARM Program will host a “Quick Convo” Jan. 6 on the Antibiotic Stewardship program area. This series of online informational sessions began in November and feature FARM staff and industry stakeholders discussing program expectations and available resources in a quick, 30-minute conversation. Workforce Development will also be featured on Jan. 16.

Streamed on Zoom and Facebook Live, these sessions offer farmers and others in the value chain a chance to engage and ask questions about FARM. Registration, recordings of the previous conversations, supplementary material, and the full schedule of topics are available on the FARM Quick Convos webpage.

Low-Fat Flavored Milk Advocated Via Joint Comments, NMPF-Led Letter

Posted on by Theresa Sweeney

NMPF submitted joint comments Dec. 23 with the International Dairy Foods Association and led an industry letter finalized Dec. 28, including member cooperatives and state dairy associations, urging USDA to finalize its proposed rule allowing low-fat flavored milk to be served in schools.

This proposed rule, which would restore not only milk provisions but also grant wider flexibilities for sodium and whole grain, comes after the original 2018 rule was overturned by a Maryland district court earlier this year on a procedural error. The 2018 rule made low-fat flavored milk available in the school lunch program.

Dairy organizations have pushed for greater flexibility on low-fat flavored milk since a 2012 school meals rule only allowed for fat-free flavored milk to be served in schools, causing a plunge in milk consumption. The proposed rule would give the nation’s schools more options while maintaining high nutrition standards.

“We agree that the flexibilities proposed by USDA, particularly those related to milk and sodium, would continue to allow schools to provide healthy and appealing meals and beverages to students, while maintaining the key nutritional requirements of the Child Nutrition Programs,” NMPF and IDFA state in their joint comments.