WASHNIGTON, DC — The National Milk Producers Federation and U.S. Dairy Export Council commended the Senate Thursday for taking key steps toward approval of new Trade Promotion Authority legislation next week. By passing two trade bills with broad bipartisan support and then voting to proceed with debate on TPA, the Senate paved the way for possible approval of the legislation before Memorial Day.

“New trade promotion authority is crucial to securing well-negotiated trade agreements that open foreign markets to more U.S. dairy products,” said NMPF President and CEO Jim Mulhern.

Added USDEC President Tom Suber: “Knowing that a trade agreement will be considered by Congress under trade promotion authority paves the way to press our negotiating partners to make their best offers on the most sensitive issues. Clearly, dairy exports fall into that category and the U.S. needs all the tools it can muster to get the best possible deal.”

TPA, which expired in 2007, is particularly important to the U.S. dairy industry because the United States now exports the equivalent of one-seventh of its milk production. TPA is the vital pathway to concluding balanced trade agreements that can unlock future export opportunities, NMPF and USDEC said.

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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. For more on NMPF’s activities, visit www.nmpf.org.

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

NMPF is encouraging dairy producers to contact Congress and urge their representatives to pass long-awaited new Trade Promotion Authority legislation as a way to secure trade agreements that deliver positive results for U.S. dairy farmers. Through the NMPF Dairy GREAT grassroots program and materials sent directly to members, NMPF is working to make it easy for producers and their cooperatives to weigh in on this important legislation.

The bipartisan TPA legislation was introduced April 16, and won strong support in committee approvals in both the House and Senate panels that oversee trade policy. Those votes set up House and Senate floor votes on the measures, likely later this month.

NMPF joined the U.S. Dairy Export Council in endorsing the legislation, saying TPA is particularly important to the U.S. dairy industry because the United States now exports the equivalent of one-seventh of its milk production. TPA creates rules under which Congress can vote on finished trade agreements without amendments.

“We need well-designed free trade agreements to keep expanding our exports,” said NMPF President and CEO Jim Mulhern. “All of the past trade agreements that were well-negotiated have been beneficial to the U.S. dairy industry, and none of those have been implemented without Congress first approving trade negotiating authority.”

TPA allows U.S. negotiators to prioritize negotiations about products that are subject to significantly higher tariffs in key foreign markets. “This is extremely important for our industry since foreign dairy tariffs are often extremely high,” said Mulhern.

NMPF and the U.S. Dairy Export Council marked Japanese Prime Minister Shinzo Abe’s state visit to Washington last month by publicly urging his Asian nation to go further in reducing trade barriers to U.S. dairy products.

In ads placed in Washington publications Politico and Roll Call, the groups welcomed Abe to the capital, but said the U.S. dairy industry cannot be left behind in negotiations over a massive, 12-nation Pacific free trade agreement. “Both our countries will win with increased trade,” NMPF and USDEC said in their open letter to Abe. “Join us in helping the dairy producers, processors and consumers in both our countries by lowering barriers and increasing U.S.-Japan dairy trade.”

Abe’s visit included formal meetings with President Obama on April 28 and an address to a joint session of Congress on April 29.

The Obama administration’s controversial Waters of the U.S. rule continued to draw opposition on Capitol Hill in April, even as the Environmental Protection Agency continued to push the regulatory measure forward.

Early in the month, the EPA and the Army Corps of Engineers submitted their final proposed WOTUS rule to the White House Office of Management and Budget. The step is typically one of the last before a regulation is officially issued. But nine days later, a key House committee approved legislation directing the agencies to withdraw the regulation and substantially revise it.

After it was published in draft form last year, the WOTUS rule was roundly criticized by agriculture groups for greatly expanding the waters subject to regulation under the federal Clean Water Act. NMPF recommended a series of changes to the draft regulation and urged the agencies to either include National Milk’s recommendations in the final rule, or withdraw the draft and rewrite it.

Officially, the Office of Management and Budget has 90 days after it receives a draft from an agency to issue a final regulation. In practice, however, the process can be much quicker or much slower, depending on a myriad of factors. Whenever OMB acts on the WOTUS rule, NMPF will review the result and assess the implications for the dairy industry.

In the meantime, on Capitol Hill, the House is expected take up legislation this month directing EPA and the Corps to withdraw the rule. Known as the Regulatory Integrity Protection Act, the legislation was approved, 36 – 22, by the House Transportation and Infrastructure Committee on April 15. In addition to telling the agencies to withdraw the rule, the bill offers a laundry list of parameters for reissuing the regulation.

Similar legislation was introduced in the Senate.

NMPF joined hundreds of organizations across the food and agriculture industry on a letter sent to members of the U.S. House of Representatives, asking them to support the Safe and Accurate Food Labeling Act. The 373 organizations – including 17 dairy coops – urged House members to back legislation that would ensure Americans continue to have access to consistent science-based standards for food labeling.

The measure, designated H.R. 1599, will set clear standards for companies that voluntarily wish to label their products, either as containing or not containing GMOs.  The Safe and Accurate Food Labeling Act would counter efforts, at both the federal and state levels, to require food companies to display GMO content on their product labels. By putting a stop to the patchwork of state-based labeling requirements, the Safe and Accurate Food Labeling Act will protect consumers from unpredictable price variations and protect farmers and food manufacturers from having to contend with inconsistent and costly regulations and standards.

NMPF has been working through the Coalition for Safe Affordable Food to generate support for the legislation, introduced by Reps. Mike Pompeo (R-KS) and G.K. Butterfield (D-NC).  H.R. 1599 currently has 37 cosponsors. The measure was the subject of a congressional hearing in March, and may be advanced out of the House Energy and Commerce committee later this spring.

NMPF praised a mid-April House of Representatives vote to repeal the estate tax as a step toward protecting farms’ financial viability for future generations. But the future of the repeal legislation looks murky at best. Long a priority of agriculture and congressional Republicans, the repeal bill was approved on a largely party-line vote April 16.

“It’s hard enough for new generations of dairy producers to establish their own farms without the prospect of the estate tax penalizing the transfer of farms between generations,” said NMPF President and CEO Jim Mulhern in a statement. “That’s why we support the action in the House of Representatives to repeal the estate tax.”

“When younger farmers inherit farms, they are often asset rich and cash poor,” Mulhern added. “The estate tax can hit them with a bill to the IRS that is prohibitively costly. This legislation helps address that problem, and will facilitate the ability of established farmers to transfer their businesses to their offspring.”

The bill repeals the estate and generation-skipping transfer taxes and makes permanent the maximum 35 percent gift tax rate and lifetime gift tax exemption. It also provides for an inflation adjustment to the exemption amount.

House consideration of the measure, H.R. 1105, known as the Death Tax Repeal Act, was timed to coincide with the April 15 tax filing deadline.

In April, Cooperatives Working Together helped its member cooperatives contract to sell 6.047 million pounds of American-type cheese, 55,116 pounds of butter, and 9.841 million pounds of whole milk powder.

When added to sales placed under contract from January through March, the April sales bring the 2015 year-to-date totals to 29.5 million pounds of cheese, 24.4 million pounds of butter, and 9.9 million pounds of whole milk powder. Together, these sales will send the equivalent of 893 million pounds of milk, on a milkfat basis, to customers in 28 countries on five continents, now through October 2015.

Developed by NMPF, CWT is a voluntary export assistance program supported by the majority of the nation’s dairy farmers. By helping to move U.S. dairy products into world markets, CWT grows the U.S. dairy farmers’ share of these expanding markets which, in turn, benefits farm milk prices.

NMPF’s summer board of directors meeting will take place Tuesday and Wednesday, June 9–10, in Arlington, Virginia. Discussion topics will include the organization’s activities and budget, as well as continuation of the export assistance program known as Cooperatives Working Together. Also, Rep. David Valadao (R-Calif.) has been invited to address the organization’s political action committee. Valadao (pictured) is a key member of the House Agriculture Committee and a dairy farmer from Tulare, CA.

Concurrent with the board meeting, members of NMPF’s Young Cooperators Program will gather for their annual dairy policy and legislative forum. The YCs will receive legislative updates, lobby their members of Congress, and tour Washington at night by bus.

In my column last month on the importance of federal milk marketing orders, I wrote about the value of maximizing the effectiveness of the tools at our disposal. That type of appraisal is particularly important this spring, as dairy farmers and cooperatives assess the value of one of our most important tools, Cooperatives Working Together.

Since its founding in the spring of 2003, CWT has become one of the most valuable programs in all of agriculture. In fact, it’s unique to dairy farming because of the hugely important role that cooperatives play in marketing the collective output of dairy producers. As a farmer-run and farmer-funded self-help initiative, CWT has evolved in the past 12 years into an irreplaceable means of allowing America’s dairy farmers to build and develop a foothold in global markets.

It’s not a stretch to say that the rise in U.S. dairy exports in the past decade, from 8% of our production in 2004, to 15% last year, is directly related to the ability of CWT’s member cooperatives to effectively harness the resources that CWT provides. Indeed, the record milk prices enjoyed last year by all the nation’s dairy farmers happened because dairy exports kept domestic markets tight – and CWT helped moved millions of pounds of cheese, butter and whole milk powder in to those export markets.

The program’s export bonuses can mean the difference between making a sale to a foreign dairy buyer, or losing that sale to a foreign company competing with us in the international marketplace. Because the U.S. milk industry is a relative global newcomer compared to our major competitors in Europe and Oceania, CWT is an important tool to help augment the other selling points that U.S.-made dairy products have to offer.

CWT has been honed to specialize in boosting exports of those products that most directly impact farm milk prices. While whey, lactose and skim milk powder are major components of the overall stream of dairy products sold in international commerce, the U.S. is already a major player in those markets – and domestic and world prices are generally in much closer alignment. But products such as cheese, butter and whole milk powder are both more influential on domestic milk prices and they are the products where we greatly lag our major competitors in terms of world market share. So that’s where CWT focuses its resources.

As a result, 60% of American-type cheese exports in 2014, and 44% of total butter exports, were made through CWT. The trends are the same so far in 2015.

But CWT is also at an inflection point, and along with it, the fortunes of America’s dairy farmers. World dairy markets have softened considerably in the past year. Major markets such as China and Russia are not importing as much dairy, creating an imbalance between global supply and demand. At the same time, milk production continues to rise in the U.S. and New Zealand, and this spring, Europe is removing the decades-old production quotas it once used to keep a lid on output. The headwinds our dairy exporters are facing are more daunting than at any point since 2009, when the Great Recession caused enormous economic turmoil.

CWT’s current authorization expires at the end of this year. Its members are currently assessing next steps. At a minimum, the program needs to be extended until 2018 – which is also the lifespan of the current Farm Bill, and within that, the new Margin Protection Program for dairy. CWT as a private safety net dovetails well with the federal MPP insurance program. Both are needed to help America’s dairy farmers over the next three years.

But an even greater opportunity exists for the program – and for the nation’s dairy farmers – if its funding level can grow from the current four cents per hundredweight, to six cents. The added resources can help boost CWT from being active in world export markets, to being an aggressive, even dominant, player in key categories. Cheese is a particularly attractive market for the U.S. industry because it plays a crucial role in domestic milk pricing. While the U.S. is a major exporter of cheese, our export volume is half that of the Europeans. Aggressive action by the U.S. to boost cheese exports can win important market share and also serve as a deterrent to increased cheese exports from New Zealand.

Milk production globally is going to continue growing between now and 2018, keeping pressure on world milk prices. A two-cent increase to six cents would allow CWT to expand on its capacity to help U.S. dairy farmers through the next few years, better positioning the U.S. industry toward a more favorable strategic position in world dairy trade.

As U.S. milk production grows –and it is growing at a rate higher than the growth of domestic consumption – we are increasingly dependent on exports to help that growth continue at profitable levels. CWT is an integral part of that process, and like no other tool available to America’s farmers, has the opportunity to do even more in the future.

WASHINGTON, DC – A Capitol Hill briefing for House staff yesterday focused on a new report on “Fluid Milk in School Programs” by the National Dairy Council. It was hosted by Representative G.T. Thompson (R-PA) and Representative Joe Courtney (D-CT) in the House Committee on Agriculture. The National Milk Producers Federation and the International Dairy Foods Association strongly support the National Dairy Council’s report and helped coordinate the briefing.

The report identified declining milk consumption in schools as a concern because of the nutritional importance of milk in children’s diets. The majority of school-aged children do not meet current government dietary recommended intakes for low-fat and fat-free milk and dairy products. With Congress set to reauthorize school nutrition programs this year, this report will provide members of Congress with the information they need to ensure that school children continue to have access to healthy and nutritious dairy products.

“The decline in milk consumption is worrisome because it is difficult to replace the nutrient package found in milk with other foods, without adding extra calories and cost,” Jean Ragalie-Carr, RD, president of the National Dairy Council, told briefing participants. She discussed the role of fluid milk in school meal programs and outlined the opportunity for improved child nutrition through increased milk consumption.

Robert Murray, M.D., professor of human nutrition at The Ohio State University, emphasized the importance of milk as a component of a healthy diet. “People must think in terms of the whole food pattern, not just individual nutrients,” he said.

Milk is the leading source of nine essential nutrients for children 2 – 18 years old. Milk also includes eight grams of protein in each eight-ounce serving.

School meals are designed to provide foods recommended by the Dietary Guidelines for Americans (DGA), including low fat and fat free milk. As the Obama administration continues its work on the next set of dietary guidelines, preliminary findings by the committee charged with drafting the DGA have already demonstrated strong support for continued consumption of dairy products. The school milk report provides background information on numerous USDA programs that include milk, as well as identifies the challenges to maintaining and expanding milk consumption to achieve recommended dietary guidelines.

 

The National Milk Producers Federation, based in Arlington, VA, develops and carries out policies that advance the wellbeing 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.

The International Dairy Foods Association (IDFA), 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 (MIF), the National Cheese Institute (NCI) and the International Ice Cream Association (IICA). 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.