Dairy Reform Proposal Part of Larger Measure to be Debated This Month

ARLINGTON, VA – The Senate version of the 2012 Farm Bill passed a crucial test today when 90 Senators voted in favor of bringing the bill to the floor for further consideration, according to the National Milk Producers Federation (NMPF).

The 2012 Farm Bill, formally designated S. 3240, passed the cloture vote Thursday by an overwhelming margin of 90-8. The measure now proceeds to the full Senate floor for debate and amendments, a process that could take several weeks before a final vote is taken.

Thursday’s action “greatly increases the chances that we can get our dairy reform proposal through the Senate, as well as the House, and passed into law this year,” said Jerry Kozak, President and CEO of NMPF. “We commend Senators Stabenow and Roberts, the leaders of the Senate Agriculture Committee, for their dogged determination to get this bill to the Senate floor.”

The Senate legislation includes a new, voluntary margin protection program, endorsed by NMPF, to better safeguard farmers against disastrously low margins, such as those generated by the low milk prices and high feed costs that cost dairy farmers $20 billion in net worth between 2007 and 2009.

Kozak said the dairy title contains a better safety net for farmers in the form of the Dairy Production Margin Protection Program, which offers them a basic level of coverage against low margins, as well as a supplemental insurance plan offering higher levels of protection jointly funded by government and farmers. Those who opt to enroll in the margin program will also be subject to the Market Stabilization program that asks them to reduce milk output when margins are poor.

NMPF representatives appeared Wednesday at a news conference in the U.S. Capitol with Stabenow and Roberts, urging that the farm bill debate begin as soon as possible.

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 30 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.

WASHINGTON, DC – Dairy farmers need Congress to pass a new Farm Bill now to help provide certainty for making future business decisions, according to Sarah Leonard (left), a fourth-generation dairy producer from Midland, VA, who spoke at a Senate news conference today about the Agriculture Reform, Food and Jobs Act of 2012 (the 2012 Farm Bill).

Sen. Debbie Stabenow (D-MI), Chairwoman of the U.S. Senate Committee on Agriculture, Nutrition and Forestry, and Sen. Pat Roberts (R-KS), the Committee’s Ranking Member, hosted the news conference Wednesday in the Capitol. They were joined by several young farmers to discuss the importance of the farm bill for the next generation of ag producers. Leonard, who operates a 325-cow dairy along with her parents, spoke about her experiences as a young farmer on a multi-generational farm.

“On our farm, we don’t focus on the latest polls, or whose campaign is raising the most money,” she explained. “We focus instead on how much rain we received last night, how much milk the cows are generating today, and what the market price of corn and soybeans are. That’s our daily reality. But part of that reality is, we need a new farm bill.”

Leonard said she was excited to see that the Farm Bill legislation contained a variety of provisions to help beginning farmers like her continue to make a living from family farms, including access to capital, crop insurance, and mentoring programs.

“I can rely on my parents for their wisdom and perspective, but it would be great to know that the farm bill also has tools that I can use to keep our family business going. I would like to sell milk, not sell our land to developers,” she said.

The Farm Bill legislation is not just about the next five years, but the next generation of farmers in America, Leonard concluded. “Dairy producers appreciate the work that Senators Stabenow and Roberts, and their colleagues, have done so far. Now it is up to all 100 Senators to take it from here,” she said.

The Senate is expected to take a procedural vote on cloture this week, after which debate on the farm bill will commence.

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 30 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.

On May 25, 2012, a letter led by Senator Coats (IN) and cosigned by Senator Lugar (IN) and Senator Gillibrand (NY) was sent to the Food and Drug Administration (FDA), urging the agency to enforce labeling regulations on standardized dairy products.

The Senators asked FDA to take immediate action against misbranded and mislabeled non-dairy products that do not meet the federal Standards of Identity for standardized products such as "milk,” "cheese,” "ice cream" and "yogurt.” This was the most recent letter sent in a continued effort by NMPF to have the FDA enforce regulations already in place. NMPF appreciated the leadership demonstrated by Senator Coats, and the support of both Senator Lugar and Senator Gillibrand, on this issue.

For more information, visit NMPF's webpage about imitation dairy products and They Don't Got Milk's Facebook page.

Cooperatives Working Together (CWT) received 110 requests for export assistance from member cooperatives in May: 71 for cheese, and 39 for butter and anhydrous milk fat (AMF). Of those, 75 were accepted: 48 for cheese, and 27 for butter and AMF, totaling 8.821 million pounds of cheddar and Monterey Jack cheese, and 5.110 million pounds of butter and AMF.

These products represented 193 million pounds, milk equivalent on a butterfat basis. That was equal to the production of 9,200 cows.

The May activity brings the year-to-date totals to 507 requests received and 359 accepted, with 234 cheese bids and 123 butter and AMF bids accepted. Total product pounds include 55.7 million pounds of cheese, and 44.7 million pounds of butter and AMF. The milk equivalent of those sales is 1.5 billion pounds, representing the annual production of 70,900 cows.

As part of efforts to gain more visibility and aid in membership recruitment, the National Ice Cream Mix Association (NICMA) is expanding its presence and accessibility with the creation of a new website available at www.icecreammix.org. The website, successfully launched this spring, contains helpful information about the organization, its membership, and the annual meeting that takes place in Fort Lauderdale, FL in January each year.

NICMA, which has been in existence since 1945, is a nonprofit trade association that represents the manufacturing industry of ice cream mix, soft serve frozen dessert mix and shake mix. The organization is located in Arlington, VA, and managed by NMPF.

This past month, the U.S. Department of Agriculture (USDA) turned 150 years old. When the country was in the throes of civil war, President Abraham Lincoln signed legislation on May 15, 1862, that created the department that would grow and touch the lives of every American every day. Over the next two months after the initial formation of the USDA, President Lincoln signed additional legislation that expanded and transformed American farming, including the Homestead Act, and the establishment of the Land Grant agricultural university system.

NMPF congratulated USDA on its anniversary and the accomplishments it has achieved throughout the decades. To learn more about USDA's 150th birthday, visit the USDA website.

The NMPF Board of Directors (BOD) will convene for its summer meeting next Tuesday and Wednesday, June 12 and 13, at the Westin Alexandria in Alexandria, VA.

The board will receive updates on current Farm Bill negotiations, including the status of dairy policy reforms known as the Dairy Security Act (originally developed by NMPF as the “Foundation for the Future” package). Aside from the board meeting, other important events will include a CWT Committee Meeting, the NMPF Officers Meeting, and the NMPF Scholarship Committee Meeting.

NMPF’s Young Cooperators (YCs) will also be in town to attend meetings of their own and visit their representatives on Capitol Hill. NMPF’s annual Capitol Hill Reception will take place the evening of June 12 and will give NMPF members the opportunity to meet prominent figures in Congress and other governmental areas.

Watch for BOD meeting highlights in NMPF’s next newsletter. For more information about the YCs, please visit NMPF’s Young Cooperator Program webpage.

The U.S. Farmers and Ranchers Alliance (USFRA), of which NMPF is a founding member, will announce the full list of panelists prior to The Food Dialogues events in Los Angeles. Two of the four panel discussions will stream live online on both Wednesday, June 21 and Thursday, June 21 from 10 a.m. to 12 p.m. PDT, providing opportunities for farmers, ranchers and the general public to register to watch and participate in the discussion online. Additionally, individuals with a Twitter account can follow all of the panel discussions by following @USFRA using #FoodD. The full list of panels is as follows:

 

Day One – Wednesday, June 20, 2012

• Hollywood and “Vine”: The Intersection of Pop Culture and Food Production
  Live streamed (www.FoodDialogues.com) on Wednesday, June 20 – 10 a.m. to 12 p.m. PDT

Panel Description: Cooking shows, food competitions, online content, books and documentaries – these are only a few examples of the many ways the entertainment world is addressing the topic of food. But, as more Americans turn to entertainment to influence their food-purchasing and consumption decisions, are they getting the full story? Are these entertainment properties providing content that is fair or accurate? This event will feature entertainment decision-makers, farmers and ranchers for a conversation about the portrayal of food and agriculture in popular culture.

• Meeting of the Minds: Touring Hollywood’s Urban Farm
  Wednesday, June 20 – 2 p.m. to 4 p.m. PDT. Follow this panel discussion on Twitter @USFRA using #FoodD to participate in a live-Tweeting of the event activities as they happen. This event will be taped and content from the panel will be available in late June 2012.

Panel Description: Communities across America, including major metropolitan areas, are embracing urban farms and community gardens. The role these urban farms play is important to the communities where they operate, often addressing a larger societal/community need. Equally important is the direct connection the farm/garden gives to consumers interested in learning more about how food is grown and raised. What can larger, conventional farms learn about best practices from urban farms – and vice versa? Join farmers and ranchers – large and small, urban and rural, as they tour Wattles Farm in Hollywood. This intimate discussion will take a look at best practices and shared techniques, no matter the farm size, and the role that urban farms/community gardens play in feeding the stomachs and souls of American communities.

 

Day Two – Thursday, June 21, 2012

• The Great Debate: Science, Technology and Food
  Live streamed (www.FoodDialogues.com) on Thursday, June 21 – 10 a.m. to 12 p.m. PDT

Panel Description: What technologies are farmers and ranchers using to produce food while protecting the environment? Is more research the answer to biotechnology in agriculture? Join a panel of leading scientists and academics, farmers, ranchers and thought leaders for a dynamic conversation about the role science and technology play in agriculture.

• The REAL Chef Challenge: Understanding How Food is Grown and Raised
  Thursday, June 21 – 12 p.m. to 2 p.m. PDT. Follow on Twitter @USFRA using #FoodD to participate in a live-Tweeting of the event activities as they happen. This event will be taped and content from the panel will be available in late June 2012.

Panel Description: Each day, individuals across the food chain – from farmers and ranchers to grocers and chefs – play unique roles in delivering the food we eat. How have these roles changed given Americans’ appetite for more information and preferences about how their food is sourced? What unique circumstances and challenges must be addressed in order for chefs, restaurateurs and grocers to continue delivering products their customers want? Do chefs have enough access to the farmers who grow and raise our food? This intimate roundtable will bring together farmers, ranchers, chefs, and others to discuss how food sourcing impacts how they grow, raise, buy and serve healthy choices for people everywhere.

 

Each panel will be moderated by a respected voice from within the food industry and panelists will include leaders throughout the California and national agriculture communities, including some of USFRA’s Conversation Leaders, celebrity chefs, entertainment decision-makers and academic professionals.

For more information, including a full schedule and updates on details, please visit www.FoodDialogues.com.

With the turn of the calendar, the time has come again for arguably the most important month observed by dairy farmers, processors, retailers, consumers, and others throughout the industry: June Dairy Month. Since 1939, June has been celebrated as National Dairy Month, honoring the important role the dairy industry has played in the economic and nutritional well-being of Americans. On June 14, 2010, Congress unanimously passed a bipartisan resolution that officially recognized June as National Dairy Month.

As most in the industry are aware, milk is a unique, complete nutrient package and is a good or excellent source of nine essential nutrients. In fact, milk is the top contributor in the average diet for calcium, phosphorus, Vitamin D and potassium. Milk provides three of the five nutrients of concern for children and adolescents: calcium, potassium, and magnesium. All milks – whole, low-fat, fat-free, flavored and lactose-free – are naturally excellent sources of calcium.

Throughout the month, raise a glass of ice-cold milk and toast America’s dairy farmers who make it possible to enjoy an abundance of fresh, delicious products – like milk, cheese, and yogurt – every single day.

 

I’m going to start this column with where I left off in April talking about dairy policy on Capitol Hill. In that article, I explained that concerning the next Farm Bill, Congress was engaged in a collective game of “kick the can” that could result in changes in farm policy being delayed until 2013. I noted that dairy farmers can’t afford to play that game.

As it turns out, the competition in which farmers really are engaged is akin to a game of financial chicken: they’re collectively careening toward the edge of financial oblivion, in the hope that someone else will stop the game first.

My analogy refers to surging milk production, from New Mexico to the Netherlands to New Zealand, which right now is producing a world-wide tidal wave of milk. There was just the slightest sense of relief when April 2012’s U.S. milk output was only up 3.2% compared to last year; the first quarter of 2012 saw average production increases above 4%. Nevertheless, April was the 27th month in a row that milk production has grown on a year-over-year basis. Cow numbers remain high based on historic patterns; milk output per cow continues to show impressive growth.

Those are the statistics. At the farm level, the hard reality is that we’re up to our udders in milk. Plants are running at full capacity; tanker loads are being dispatched across the country in hopes that someone will buy them at a steep discount. Cooperatives are instituting base plans to rein in output. And, importantly, while exports are absorbing some of the added output, the companies doing the exporting are competing with a similar milk tsunami from our global competitors.

Clearly, supply and demand are imbalanced. Eventually, conditions will correct, due to changes both here at home and abroad. But in the meantime, farmers are once again seeing margins eroded, not just from milk prices, but from high, sustained feed costs. Corn is still in the $6/bushel range for delivery this summer. Alfalfa is being sent to China to feed dairy cattle there. And hard-earned farm equity is again being lost here at home.

There is an alternative to this roller coaster, and it’s what NMPF has been promoting for more than a year: the Dairy Security Act, which will proactively and prudently trim milk output when U.S. dairy farmer margins are stressed, while at the same time providing them margin protection when conditions are poor – as they are right now.

Now, we’ve heard claims, mostly based on anecdotes, that the occasional implementation of the market stabilization program to trim milk output slightly will make the U.S. globally uncompetitive. That assertion is debunked by the recent report on the Dairy Security Act, prepared by Dr. Scott Brown of the University of Missouri for Congress. He found that milk production growth in the years 2012-2022 slows just slightly, with production of dairy products only 0.2% less, than if the market stabilization program didn’t exist.

In fact, what will really make the U.S. uncompetitive is a dairy producer community that has been so shell-shocked by booms and busts that it cannot make investments in the future. The DSA gives farmers tools they badly need to help manage their price risk, and it complements, not conflicts with, existing, private-sector risk management tools. It is this same farmer community that currently invests in new plant capacity, the funding of the U.S. Dairy Export Council, and the voluntary backing of Cooperatives Working Together, all of which together are what has helped boost our exports to 13% of current production.

But these investments can’t be sustained without a better safety net. Consumer markets, here in America as well as abroad, can’t magically absorb all this milk during times like these. What we need is a mechanism to put the brakes on, and stop the rush to the abyss before it’s too late.

As NMPF’s Chairman, Randy Mooney, has said: “Whenever we have growing demand for products in the world, dairy farmers in the U.S. can supply that product, but we have to do it profitability. And if we can’t do it profitably, we’re not going to do it. The market stabilization program allows us to adjust our supply to get back to profitability, so we can feed the world.”

That’s the game we need to be playing, but we can only change those rules by passing the Dairy Security Act.

Expert Review of Dairy Security Act Finds Little Impact on Consumers, Exporters

ARLINGTON, VA – As efforts move forward this year in both the House and Senate to complete work on the 2012 Farm Bill, the economic analysis performed of the major dairy policy option in play helps demonstrate the effectiveness of that program, according to the National Milk Producers Federation (NMPF).

That analysis was developed by Dr. Scott Brown of the University of Missouri, who was asked last month by the House Agriculture Committee to thoroughly review a modified version of the Dairy Security Act. Brown presented his analysis to the House Agriculture’s Livestock, Dairy and Poultry Subcommittee at a hearing on April 26th, the same day that the Senate Agriculture Committee approved a farm bill containing essentially the same program in its dairy title.

Now that the Senate is expected to act on that bill in the coming weeks – and with the House Agriculture Committee also expected to begin marking up its own version of the farm bill – lawmakers “should be certain to take a look at the findings of Dr. Brown’s analysis and understand the merits of what the dairy producer community is advocating,” said Jerry Kozak, President and CEO of NMPF. “The bottom line is that the ideas on the table on Capitol Hill are ones that will work on the farm once they’re part of this new farm bill.”

Brown’s report shows that the revised safety net under consideration will help protect farmers economically from the effects of catastrophically-low margins, reverse those low margin conditions more quickly, and not adversely impact consumer prices or exports of U.S. dairy products. The modified Dairy Security Act contains two key provisions: a margin protection program that farmers can opt to use to insure against low margins; and market stabilization programs that uses milk payments to more quickly and effectively send market signals to farmers when conditions are poor.

According to Dr. Brown’s analysis of the period 2012 through 2022, the average growth in milk production would be just one-tenth of one percent (0.1%) less what would occur if the stabilization program were not part of the dairy title. The analysis says the stabilization program would be in effect only 7.5 percent of the time studied: 10 months, out of the 11 years covered in the analysis.

Because of this, U.S. output of dairy products is two-tenths of one percent (0.2%) less throughout the analysis period, which should not significantly affect exports. The analysis shows that the worst-case scenario is a potential reduction in Nonfat Dry Milk exports of just three tenths of one percent (0.3%).

“This analysis clearly shows that U.S. milk output and dairy sales will hardly undergo the devastating impact that processors are claiming the program would generate,” Kozak said. He also noted that farm-level milk prices would average just four-tenths of a cent per gallon higher during the period analyzed, and that as a result, retail cheese prices are little changed on average.

Kozak said that “the opposition to the market stabilization provision of the Senate farm bill dairy title has been merely based on anecdotes, not on economic reality. The bogeyman of dried-up sales, either domestically or from exports, disappears when exposed to the light of reality.”

The analysis concludes that the dairy title will:

• Reduce dairy farmer margin volatility
• Have only small effects on the milk supply
• Increase dairy farmer margins when needed the most
• Have minimal impact on exports of dairy products
• Result in insignificant increases in consumer prices for milk and dairy products
• Not result in long periods of operation of the market management program.

 

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 30 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.

NMPF Working with Ag Committee Leaders to Expedite Vote in Senate

ARLINGTON, VA – The National Milk Producers Federation (NMPF) is working with a bipartisan group of senators, as well as with other farm and agriculture organizations, to urge the Senate’s leaders to bring the pending 2012 Farm Bill legislation to a vote this spring.

In a letter sent Tuesday to Senate Majority Leader Harry Reid, and Minority Leader Mitch McConnell, 44 Senators urged that the farm bill be brought to a vote as soon as possible. If Senate action is delayed, it greatly diminishes the chance that the House of Representatives will make time to act on the Farm Bill yet in 2012 – meaning that important changes in dairy policy will not come to fruition this year.

In the letter circulated by Agriculture Committee members Max Baucus (D-MT) and Mike Johanns (R-NE), along with Sens. Maria Cantwell (D-WA) and Roy Blunt (R-MO), the Senate leadership is told: “We need to act soon to complete a farm bill in 2012 and provide certainty for farmers, ranchers, rural communities, other stakeholders, and all Americans. We very much appreciate your recognition of the need for timely action on the farm bill.”

The Senate leadership received a similar letter from farm groups last week, when NMPF joined more than 125 other agricultural organizations in pointing out how important it is to act on the farm bill quickly. That letter pointed out to Reid and McConnell that the farm bill “is one piece of legislation upon which all Americans depend, urban as well as rural. With limited time remaining before expiration of current program authorities, time is of the essence. While each of our respective organizations will continue to work to accomplish our key priorities, the farm bill must move forward.”

NMPF President and CEO Jerry Kozak said that “the clock is ticking on our opportunity to get a farm bill done in 2012. We appreciate the display of bipartisan effort by senators from across the country to move this legislation forward.”

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 30 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.