DMC an Essential Risk-Management Option for 2021

Forecasts for prices and politics both make signup for the Dairy Margin Coverage Program a compelling risk-management choice for 2021, National Milk Producers Federation Senior Vice President for Member Services & Strategic Initiatives Chris Galen says in an NMPF podcast released today.

“Congress is still trying to pass another stimulus bill to help all walks of life in our society and our economy and hopefully agriculture will be part of that, but right now there aren’t any serious negotiations. Who knows if that can will be kicked into 2021?” Galen said. “What we do know is that the DMC program is forecast to make payments in the first part of 2021. So you’ve got to go with what you know.”

NMPF is offering dairy farmers, cooperative members and state dairy associations a free webinar on Wednesday, Dec. 2, to help them develop effective risk management plans that can protect them in what’s predicted to be a volatile year in 2021. NMPF Chief Economist Peter Vitaliano will be discussing the dairy price outlook for next year, and the value of risk management tools including Dairy Margin Coverage, in the webinar, moderated by Galen, at 1:30 p.m. EST on Wednesday, Dec. 2.

Participants will be able to ask questions about the year ahead and learn more about how farmers can manage their risk through expected turbulence.  The webinar will examine the milk and feed price forecast, forecast margins, and analyze how the Dairy Margin Coverage program will offer farmers protection against price volatility. Dairy producers seeking more information can visit NMPF’s page on risk management to learn more about DMC, CFAP and other tools to promote financial security for dairy operations.

To listen to the full discussion, click here. You can also find this and other NMPF podcasts on Apple Podcasts, Spotify and Google Play. Broadcast outlets may use the MP3 file. Please attribute information to NMPF.

Dairy Farms Innovating Their Way to a Sustainable Future

“Innovation” is a buzzword thrown about to the point of cliché. What it is varies with the circumstance.

For tech professionals, innovation could be an updated app or a streamlined solution. For teachers, it might be the newest way to engage students remotely. For those in health care, it may be a vaccine or more-effective treatment.

On dairy farms, innovation can look like … entomological wastewater filtration and effluent subsurface drip irrigation. Neither are buzzwords. Both are examples of how dairy is innovating its way toward a more sustainable future.

Royal Dairy in Royal City, Washington, wanted to enhance its waste-management system and reduce GHG emissions. Seeking solutions, Austin Allred, owner of Royal Dairy and a member of Northwest Dairy Association, piloted and adopted the BIDA® System developed by BioFiltro. The international wastewater filtration company uses worms within a passive aerobic system to clean wastewater from the dairy for irrigation. By investing in this technology, Royal Dairy has reduced its Total Suspended Solids (TSS) by 99% and reduced total Nitrogen (TKN) by 83%. As an added benefit, it also creates a rich fertilizer from the worm castings.

Another sustainability solution is found at De Jager Dairy North and California Dairies Inc., member McRee Dairy, both near Chowchilla, California, where drip irrigation is leading toward a future of better harvests and reduced emissions.

The two dairies partnered with Israeli company Netafim and Sustainable Conservation to develop and test a sub-surface irrigation system that delivers liquid dairy cow manure as a fertilizer close to the crop’s root system. This results in needing up to 35 percent less water while maintaining or even increasing crop yields in addition to reducing irrigation-related greenhouse gas emissions by 70 percent – saving costs and building resilience against droughts projected to worsen with climate change.

Projects like these, which put in the work today to develop solutions for a better tomorrow, are only two of the many on-farm innovations taking place on dairies. For those who spend their time planting as well as milking, carbon sequestration made possible by cover cropping and conservation tillage further maximize efforts like Allred’s. From improved anaerobic digesters and technology that separates nutrients, to feed additives that reduce methane emissions, dairy farming is continuing to advance – and lead – in adoption of sustainable technologies and practices in agriculture.

And they’re efforts the industry supports, with programs like the National Dairy Farmers Assuring Responsible Management (FARM) Environmental Stewardship initiative that measures a farm’s carbon and energy footprints. The initiative equips farmers with data that helps them understand their sustainability impact and chart a course for continued progress that’s essential to ensure industry progress toward the collective 2050 environmental goals of becoming carbon neutral or better; optimizing water use; and improving water quality.

On-farm innovation on dairies may not always be as obvious as an app or a vaccine. But they’re no less real or important. Dairy farms are sites of constant innovation, with farmers embracing new methods and new measures. And their proven track record of innovation is set to grow even further.

NMPF Offers Webinar on 2021 Dairy Economy as DMC Deadline Approaches

With deadlines for the Dairy Margin Coverage program and Coronavirus Food Assistance Program signups approaching on Dec. 11, the National Milk Producers Federation is offering dairy farmers, cooperative members and state dairy associations a free webinar Dec. 2 to help them develop effective risk management plans that can protect them in what’s predicted to be a volatile year in 2021.

NMPF Chief Economist Peter Vitaliano, creator of the monthly Dairy Market Report released earlier today, will be discussing the dairy price outlook for next year, and the value of risk management tools including Dairy Margin Coverage, in a webinar moderated by Chris Galen, NMPF’s Senior Vice President for Member Services, at 1:30 p.m. EST on Wednesday, Dec. 2. Participants will be able to ask questions about the year ahead and learn more about how farmers can manage their risk through expected turbulence.

The webinar will examine the milk and feed price forecast, forecast margins, and analyze how the Dairy Margin Coverage program will offer farmers protection against price volatility. To register, click here: https://us02web.zoom.us/webinar/register/WN_yr4QZ8HhSc-zdvujrg_zBA

Current USDA calculations predict that the DMC, adopted with NMPF’s leadership in the 2018 farm bill, will offer payments averaging $1.05 per cwt in the first eight months of next year for those at the maximum $9.50 coverage level. That vastly outstrips program premiums, making coverage for a farm’s first 5 million pounds of milk production a no-brainer, Vitaliano said. The DMC also offers affordable protection to all producers against price catastrophes and can be used in tandem with other risk management tools, such as the Dairy-Revenue Protection and the Livestock Gross Margin programs.

To determine the appropriate level of DMC coverage for a specific dairy operation, producers can use the recently updated online dairy decision tool offered through the USDA’s DMC informational page. Dairy producers can also visit NMPF’s page on risk management to learn more about DMC, CFAP and other tools to promote financial security for dairy operations.

YC’s Weber Navigates the Challenges of Launching a Dairy

James Weber is learning as he goes along – but the coronavirus pandemic, disrupted international markets, shifting technology and turbulent political debates make life as a beginning dairy farmer challenging, as Weber, explains in this week’s Dairy Defined podcast.

Weber, 30, operates Weber Family Dairy near Frankenmuth, Michigan. He’s a member of the Michigan Milk Producers Association dairy cooperative and the 2020 chairman of the National Milk Producers Federation’s Young Cooperators program. “There are lots of life lessons that are learned, that can only be learned through living them,” Weber says in the podcast. “One of the things that I’ve learned about through COVID here was risk management. And that’s just one of those things where you have to live it to learn it.”

To listen to the full discussion, click here. You can also find this and other NMPF podcasts on Apple Podcasts, Spotify,  and SoundCloud. Broadcast outlets may use the MP3 file. Please attribute information to NMPF.

In the Coming Year, USTR Must Address Key Trade Barriers Harming U.S. Dairy

Given the national and strategic importance of U.S. dairy exports, the National Milk Producers Federation (NMPF) and the U.S. Dairy Export Council (USDEC) today released an Executive Summary of its recent detailed analysis of the intricate web of global trade barriers that are hampering overseas dairy sales, to better inform and guide the work of the incoming administration and other policymakers.

The detailed submission to the United States Trade Representative’s (USTR) office made late last month  was created as part of the USTR’s annual call for input to inform its National Trade Estimate Report on Foreign Trade Barriers. It outlined nearly 40 pages worth of various challenges and opportunities facing U.S. dairy exports in more than 30 foreign markets.

“Exports are essential to the economic survival of our industry, and it is important U.S. trade negotiators fully understand all of the trade-distorting tricks used to keep high-quality U.S. dairy products out of global markets,” said Tom Vilsack, president and CEO of USDEC. “The USTR has worked hard to address many of these barriers, and USDEC members have benefited from our broad approach to handling issues ranging from trade policy to regulatory hurdles. We stand ready to continue our work alongside USTR and USDA to address these and future trade barriers.”

More than $6 billion of dairy products were exported in 2019, accounting for 15 percent of all U.S. milk production, with more potential to serve consumers overseas and create dairy jobs at home.

“Our comments to the USTR provide a road map for dozens of opportunities to create a more level and consistent global playing field for the U.S. dairy sector,” said Jim Mulhern, president and CEO of NMPF. “The best avenue to stamp out many of these trade tactics that disadvantage American-made dairy products is to strongly convey the message that foreign restrictions on U.S. agriculture must end and that new trade agreements that dismantle trade barriers and put America’s dairy industry on a level playing field are necessary.”

The industry’s submission dedicated the most attention to key markets where trade barriers are limiting U.S. market access, including China and Europe. Foreign countries use policies including high tariffs, retaliatory duties, geographic indications, import licensing, and unscientific health requirements to keep U.S. goods at bay. The submission also focused on the importance of enforcing hard-won gains under existing free-trade agreements, particularly the United States-Mexico-Canada Agreement (USMCA).

NMPF and USDEC said the United States should prioritize trade deals most likely to yield net positive benefits for dairy and agriculture, such as with the United Kingdom and key Asian markets, including those in Southeast Asia.

NMPF Statement on EU’s Retaliatory Tariffs on Dairy

In response to the European Union’s (EU) imposition of retaliatory tariffs on U.S. agriculture exports, which escalates the dispute over World Trade Organization (WTO)-incompliant aircraft subsidies, National Milk Producers Federation President and CEO Jim Mulhern issued the following statement:

“Europe has long wielded restrictive and unjustified trade tactics to limit fair competition from U.S. agriculture, including dairy exports. While Europe may be authorized to retaliate, the U.S. has already taken deliberate action to address the WTO decision. Meanwhile, Europe has failed to come into compliance with their WTO obligations.

“As the U.S. works to hold Europe accountable to its WTO obligations, U.S. retaliatory tariffs against EU dairy products continue to play a key role in bringing Europe to the negotiating table and compelling them to fulfill their trade commitments. The EU’s restrictive trade policies that have resulted in a one-way flow of agriculture trade, and in particular dairy trade, to Europe is something that both the current and future Administrations need to keep in mind. In fact, the trade deficit between the EU and U.S. continues to widen as the EU uses unjustified trade tactics to erode U.S. market access and limit fair competition.

“One of the most egregious of these tactics is the EU’s misuse of geographical indications (GIs) to ban the U.S. from selling cheeses with common names, such as asiago, feta or parmesan. We commend USTR’s continued maintenance of GI cheeses on the WTO-authorized list of tariff retaliation as these tariffs help to temporarily level the playing field for U.S. producers.

“It’s time for Europe to not only comply with its WTO obligations, but also make a fundamental change to retire its discriminatory agricultural trade policies once and for all.”

NMPF Congratulates President-Elect Biden and Incoming Congress

The National Milk Producers Federation congratulated President-elect Joe Biden and members of the upcoming 117th Congress for their election victories, pledging to work for bipartisan solutions to the many challenges faced in agriculture and in the nation.

“Congratulations to President-elect Biden and the incoming members of the 117th Congress, who will have a lot of work to do in this country, from legislating to building common ground,” said NMPF President and CEO Jim Mulhern. “Dairy is ready to do its part and work with the administration and Congress to face difficult problems successfully, in the bipartisan spirit we have always practiced and believed in.”

NMPF has long been committed to working with both major political parties for sound, consensus-based public policy. More on NMPF’s approach to policy, why dairy farmers and the cooperatives they own possess a distinct voice within agriculture, and the crucial role they can play in the months ahead, can be found in this week’s Dairy Defined column.

Dairy is Defined by Bipartisanship

A close reading of policy statements from dairy producers will reveal one word that keeps popping up: bipartisan.

Unfashionable though that may seem in certain quarters, bipartisan solutions are the best solutions. They acknowledge that one side doesn’t have a monopoly on the best ideas, a basic sign of mutual respect. They’re less controversial, because everyone has to buy in to a policy before it’s approved, minimizing later attempts to naysay and undercut whatever’s put in place. And that makes bipartisan solutions more likely to last: A policy that’s widely accepted is less likely to be tossed out the moment a different political party takes power.

Looking at the political landscape that’s coming into focus after the 2020 elections – the most bitter and viciously fought in anyone’s memory — it’s safe to say that for at least the next two years, bipartisanship isn’t everything. It’s the only thing, as hard as that may be for some to accept at this moment.

While some congressional electoral battles aren’t over yet, 2021’s political contours are already clear. The House of Representatives will be more narrowly divided. The Senate will be more narrowly divided. While the popular vote was not that close, the White House was won via razor-thin victories in several states. It’s a recipe for tension and stalemate, for attacking the other side in the hopes that a more favorable balance – for one’s own side – is achieved in the next election. That approach is understandable, predictable, and for the health of the country, toxic.

The more difficult, but needed, approach, is to find common ground, if not on everything, then at least the most pressing issues of the day: coronavirus, the economy, and other key concerns that are literally life-and-death for lives and livelihoods. Despite the easy impulse toward cynicism, bipartisan solutions have been found just this year, and can be found again.

Dairy has its own interests, just like everyone else. But the emphasis dairy places on bipartisanship isn’t just lip service. It’s rooted in specific circumstances that’s produced a distinct emphasis among dairy farmers to seek political common ground.

It’s no secret that farmers overall tend to be conservative politically. But unlike commodities in which production tends to cluster in deep-red states, dairy has always developed not far from urban areas, due to the perishable nature of its much-needed products. In the 21st century, that’s naturally encouraged a bipartisan approach to problem-solving. Even the most conservative dairy farmer has an interest in working with someone who’s more liberal, given how many of those farmers live in deep blue (shout out to California and New York) or profoundly purple (hello, Wisconsin, Pennsylvania and Michigan – and let’s not forget Arizona) states. Conversely, dairy has helped lawmakers who otherwise would have little contact with agriculture better understand its needs – because those lawmakers represent dairy farmers and need to understand their issues.

That ability to talk to and work with both sides has also given dairy a unique sensitivity, and ability to address, concerns from across the political and consumer spectrum. Dairy fights against regulations that needlessly undermine their ability to effectively feed the world; it’s also highly sensitive toward public concerns, proactively addressing issues such as animal welfare and workplace safety through its FARM Program and supporting initiatives such as the Dairy Environmental Sustainability Goals and dairy’s Net-Zero Initiative to achieve a carbon-neutral sector by 2050. Dairy producers know that successfully serving common goals is possible, because we achieve it every day. And we will continue to seek bipartisan solutions in today’s often-treacherous political environment.

In the end, dairy farmers produce a commodity, one among numerous other commodities jostling in the policy arena. But the most valuable commodity in America today may be the ability to bridge partisan divides: That’s always been important, but it may be becoming existential. Dairy, in its own way and for its own reasons, is well-positioned to be part of today’s necessary policy solutions, and it’s all because of that word that keeps coming up: bipartisan.

We congratulate President-elect Biden and the incoming members of the 117th Congress. There’s a lot of work to do in this country in the next few months and years, from legislating to healing. Dairy is ready to do its part – and much more, if that’s what the nation needs.