As the organization prepared for another active year in 2014, NMPF announced staffing changes to help achieve the best possible results over the next year.

In addition to Jim Mulhern taking over as the President & CEO, and Brenda Rowe joining the staff as Mulhern’s executive assistant, Beth Briczinski was promoted to Vice President, Dairy Foods & Nutrition. Also receiving a promotion was Betsy Flores, who now holds the title of Vice President, Animal Care. In addition, Jamie Jonker is now the Vice President of Sustainability & Scientific Affairs.

Long-time NMPF board member Bill Dropik, 75, passed away December 24th at his home in Nelson, MN. In addition to representing First District Association on the NMPF Board of Directors for eight years, Dropik was active in the Minnesota Milk Producers Association and the Dairy Leaders Roundtable. He farmed in central Minnesota for 50 years, and was still actively involved in his family dairy operation until his death. He is survived by his wife of 55 years Helen, eight children, 22 grandchildren, and 19 great-grandchildren.

As the new President and CEO of NMPF, I look forward in the coming years to continuing the use of this forum to communicate my views about the challenges – and opportunities – facing NMPF and the dairy industry. Hopefully, the timing of this, my first column, is fortunate in the sense that many of us start each New Year making lists of things we’d like to do (or stop doing), change or achieve. For my inaugural CEO’s Corner column, then, let me start with a brief list of the things we’ll being working on with NMPF’s members in the coming year.

The top item on that list is, for better or worse, a holdover from last year, and even the year before that: establishing a new and better safety net for dairy farmers. What should have been achieved by Congress in 2012, and what had a chance of getting done last year, was passage of a new farm bill containing the Dairy Security Act. NMPF and its members have been working hard with Congress since 2009 to devise and pass a new dairy program. The good news is that it appears we’re on the cusp of getting a farm bill done as 2014 begins.

Members of the House and Senate are returning to Capitol Hill this month, and finalizing the farm bill is also at the top of the list of New Year’s resolutions for them. I am cautiously optimistic that the farm bill negotiations between members of the House and Senate Agriculture committees will produce an economically and politically viable bill. It’s been bedeviled by controversies ranging from the marketing of catfish and eggs, to the level of spending on food stamps and crop insurance – but differences over these items can and will be resolved. We still need to thread the needle by ensuring that the resulting bill will pass both chambers, and be signed by the President, but I believe we’re just about there.

The second part of this resolution is just as critical: namely, ensuring that once Congress has finished its work in passing the farm bill, the resulting dairy program must be quickly and effectively implemented by USDA. New rules and regulations will have to be developed by USDA once the farm bill becomes law. Since the new margin insurance program will be the biggest change in dairy policy in many years, there’s going to be a learning curve, especially for farmers who will have to make important decisions about whether to participate in the insurance program, and at what level of coverage.

This isn’t on the scale of educational challenges resulting from, say, the Affordable Healthcare Act, but the point is still that information must be shared quickly and clearly with farmers, and we can’t rely just on the Agriculture Department to do that job. NMPF will be working hard with its members to help shoulder the load.

Another item that’s a holdover from the past, but that is also critical to the future success of the dairy industry, is immigration reform. That effort has moved in fits and starts for more than a decade. The passage of last year’s comprehensive reform bill in the Senate was a crucial and welcome step. The House needs to follow suit and pass similar legislation, in whole or in part, so that we can work with leaders in both chambers to get something done. The window for getting legislation passed in the coming year is narrow but not closed. That’s why we have to resolve to make it happen in 2014.

Yet another priority issue is maximizing the value of the pending Trans-Pacific Partnership (TPP) trade agreement to America’s dairy farmers. Negotiations of this pact will likely determine this year whether the TPP final agreement represents a net positive opportunity for the U.S. dairy sector. We need greater disciplines on non-tariff barriers, as well as greater access into Canada and Japan, in order for a TPP agreement to be useful to America’s dairy farmers. We also need reforms of New Zealand’s dairy policies as part of the deal.

The other thing I’m putting on my list is something I mentioned in my speech last November to NMPF’s members: beginning the dialogue on reforming the Federal Milk Marketing Order system. The industry will need time to adjust to a new dairy safety net in 2014, but the underlying system of determining classified prices also needs to be improved. I believe we can capitalize on the momentum behind the Dairy Security Act, and begin the work within the producer and cooperative community of solving the next, essential piece of the pricing puzzle by addressing federal order reform.

I look forward in 2014 to working on all of these issues, and more, to strengthen our industry and build a more prosperous future for America’s dairy farmers.

ARLINGTON, VA – ’Tis the season to enjoy real dairy products such as butter, cheese, whipped cream, and eggnog, according to DairyUS, the animated character based on the iconic REAL® Seal logo, who shares that perspective in a new video that was released today by the National Milk Producers Federation (NMPF).

Visitors to the REAL® Seal website www.realseal.com will be greeted by an animated DairyUS throughout the holiday season. Flying over snowy rooftops in a sleigh pulled by festive dairy cows instead of reindeer, DairyUS and his industrious little elf remind consumers that December is the perfect time to incorporate real dairy products into their holiday recipes.

DairyUS was created earlier this year to help a new generation of consumers distinguish between genuine U.S. dairy products and a growing list of list of imitations. A contest was held in the fall to select his name, with the winner being announced at NMPF’s annual meeting in Phoenix last month. In addition to his presence on the REAL® Seal website, he also has made appearances on the REAL® Seal Facebook page as well.

“DairyUS will help both kids and adults learn about foods made with real dairy products,” NMPF’s incoming President & CEO Jim Mulhern explained. “The REAL® Seal means a product is a real dairy product, made with milk from cows on U.S. dairy farms and without imported, imitation, or substitute ingredients. That’s an important distinction consumers can make when they’re browsing the grocery store aisles.”

The animated character has already appeared in other short videos this year. He will continue to do so in 2014 to highlight topical and seasonal events, such as holidays and sporting events, providing consumers with easy tips to incorporate more real dairy foods into their everyday meals.

 

The National Milk Producers Federation (NMPF), 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.

The leaders of the House and Senate Agriculture committees continue to negotiate this week on a number of issues to break the impasse over the long-pending farm bill. Those differences include the final shape of an updated federal dairy program, but also range from the level of food stamp cuts, to conflicts between row crop producers in various parts of the country. 

The Senate will not formally return to Washington until next week, while the House is scheduled to adjourn for the year next Friday. Talk continues to grow about the need for a short-term extension of current policies to stave off the implementation of permanent agriculture law, and with it the dairy “cliff” of higher price support levels for milk and other commodities. NMPF continues to urge farm bill conferees to finish their work in the coming weeks so that pressure for a long-term extension of a year or more doesn’t gain any traction. Farmers can use NMPF’s Dairy GREAT system to urge Congress to support the dairy provisions in the Senate bill.

Meanwhile, NMPF last week circulated a new analysis of the House and Senate dairy plans, which showed the Senate language backed by NMPF will cost $100 million less over 10 years than the House program, which is backed by dairy processors.

The analysis, by the nonpartisan Congressional Research Service, was the first to directly compare the House and Senate versions of the farm bill. It put the 10-year cost of the Senate dairy program at $302 million above current programs, and the House language $418 above that so-called “baseline.”

Incoming NMPF President Jim Mulhern said the analysis, while conservative, buttressed NMPF’s point that the final dairy program needs to couple margin insurance with a market stabilization program that caps costs. That is essentially the Senate plan.

“Without the market stabilization program to both reduce the duration of low margin conditions, and reduce government outlays … the House plan would be a budget-buster—and one that we urge the conferees to reject,” Mulhern said.

Mulhern also criticized attempts to distort an earlier analysis to show that consumer prices will increase under the Senate program. The earlier analysis was done by University of Missouri agricultural economist Scott Brown.

“The purpose of market stabilization is to keep farmers’ milk prices from staying too low, for too long,” Mulhern said. “Any suggestion that it will spike retail prices to abnormally high levels is a deceitful and deliberate misinterpretation of the studies done on the impact of the (two bills).” In the Brown analysis, the average difference in farm milk prices between the two approaches was only two cents per gallon over four years, not enough to significantly impact retail prices.

Dairy industry leaders from across the country converged on Phoenix for four days in mid-November to bid an emotional goodbye to outgoing NMPF President Jerry Kozak (left, with Mooney), and to hear incoming President Jim Mulhern’s vision for the organization’s future. The occasion was NMPF’s 2013 annual meeting, held jointly with the National Dairy Promotion and Research Board and the United Dairy Industry Association.

The meeting also featured a major policy speech by NMPF Board Chair Randy Mooney, and an expanded Town Hall in which 800 dairy farmers heard presentations on a long list of industry issues. In addition, six new board members were elected to the NMPF board, and the organization announced the name selected for the cartoon character it is using to help revitalize the dairy REAL® Seal.

In all nearly 1,000 people attended the meeting at the Arizona Biltmore Hotel. Headline speakers were former NFL head coach Herman Edwards, and organizational change expert Peter Sheahan. Agri-Talk Radio host Mike Adams was master of ceremonies, and up-and-coming country music star James Wesley provided banquet entertainment. Wesley (left) clearly enjoyed performing for a large group of farmers.

The meeting’s emotional highlight came when Kozak, president and CEO since 1997, thanked those with whom he has worked in the past 16 years, and turned the reins of the organization over to Mulhern.

Kozak will be formally replaced as president January 1 by current Chief Operating Officer Jim Mulhern, a Wisconsin native who has worked for the dairy industry in various capacities for three decades. During his remarks, Mulhern urged farmers to become more engaged in both NMPF and the policymaking process.

“We need your financial commitment, yes,” he said, “but even more importantly, we need your time and effort and engagement. The more engagement our members have … the more our organization can achieve for our members. It’s a virtuous circle.”

Mulhern also stressed the need for more communication by the dairy industry. “We must tell our story,” he said, “because if we don’t, others—who don’t have our interest at heart—are telling a very different, and harmful, story.”

On other subjects, Mulhern (left) said once the 2013 farm bill is enacted, NMPF should tackle reform of the federal milk marketing order system and consider addressing some changes to federal identity standards for dairy foods—but only if the changes benefit farmers. “Some of the dairy processors talk about reforming federal milk orders when what they really seem to mean is increasing their control of the market and their share of the dairy dollar,” he said. “That’s a non-starter for us. Our focus will be on reforms needed to ensure the orderly marketing of milk and to protect the financial interests of the nation’s dairy farmers.”

Mulhern noted that some in the processing community are also calling for changes to the federal standards that protect the content and quality of dairy foods. But, he said, sometimes this talk is delivered by those who either don’t understand the concept of standards of identity or those who are looking for a way to benefit financially through deviations marketed as “innovations.”

“Are there some provisions of standards that could be improved? Absolutely, especially if they relate to improvements and efficiencies in plant-level processing technologies,” Mulhern said. “However, NMPF will not agree to revisions to standards designed to ‘water down’ their quality or deceive consumers, and we will continue to work diligently to preserve all aspects of standards that preserve the integrity of traditional dairy products, their names and their composition.”

Board chair Randy Mooney (left) delivered his speech  as a House-Senate conference committee was working in Washington on a final, compromise version of the 2013 farm bill. Mooney blasted the House bill’s proposed dairy provisions as costly to taxpayers, a bonanza for processors and not what’s needed to help farmers.

Mooney said the House provisions would create conditions reminiscent of the early 1980s, when the federal dairy safety net was far too generous. In those days, he said, farmers produced more milk than the market could absorb and the government became their biggest customer.

Today, Mooney said, we are in danger of repeating history because some in Congress are forgetting the lessons of the past. “It’ll be cheap milk for processors, with taxpayers on the hook to keep the insurance money flowing,” he said. “And mark my words: If this approach were adopted, it would be the first, and last time, that a farm bill features this type of program. It’s just not built on a sound financial footing.”

The Town Hall, a tradition at NMPF annual meetings, kept attendees engaged throughout the four-hour session. Attendees heard presentations from NMPF staff on a long list of issues, which included the environment, trade, GMOs, food standards, and residue testing, in addition to the farm bill and immigration reform.

The following individuals were elected to serve as NMPF officers for 2014:

• Randy Mooney, Dairy Farmers of America – Chairman
• Ken Nobis, Michigan Milk Producers Association – First Vice Chairman
• Adrian Boer, Northwest Dairy Association – Second Vice Chairman
• Mike McCloskey, Select Milk Producers, Inc. – Third Vice Chairman
• Dave Fuhrmann, Foremost Farms USA – Secretary
• Doug Nuttelman, Dairy Farmers of America – Assistant Secretary
• Pete Kappelman, Land O’Lakes, Inc. – Treasurer
• Neal Rea, Agri-Mark – Assistant Treasurer (who is new to the officer group)

The following new board members were elected to serve on the NMPF board for 2014:

• Michael Anderson, Farmers Cooperative Creamery
• David Cooper, FarmFirst Dairy Cooperative
• Kelly King, FarmFirst Dairy Cooperative
• Peter Janzen, Land O’Lakes, Inc.
• Tom Pittman, Premier Milk, Inc.

Also at the meeting, NMPF unveiled the new name for the animated REAL® Seal character: DairyUS. It was selected in a nationwide online content in which nearly 800 votes were cast. DairyUS received 379 votes.

The animated character, based on the iconic REAL® Seal logo, will help a new generation of consumers distinguish between genuine U.S. dairy products and a growing list of list of imitations. A video announcing the name is on the REAL® Seal website homepage.

Also at the annual meeting, NMPF offered a preview of the REAL® Seal buyer’s guide, a web-based search engine that will make it easier for consumers to patronize brands and stores that offer real dairy products. The buyer’s guide website will soon be online.

More information from the annual meeting is available online, including speeches and presentations, and photos.

Even though the program only received requests for export assistance for a few weeks in November due to the NMPF Joint Annual Meeting and the Thanksgiving holiday, Cooperatives Working Together (CWT) provided assistance on 47 sales of cheese and butter totaling 14.8 million pounds. The accepted requests included 3 million pounds of butter (1,362 metric tons) and 11.8 million pounds of cheddar, Gouda, and Monterey Jack cheeses. The product will go to 16 different countries and will be delivered between November 2013 and May 2014.

Through November, CWT-assisted exports of butter totaled 87.9 million pounds (39,879 metric tons) and 121.9 million pounds of cheddar, Gouda, and Monterey Jack cheeses. The product is going to 40 different countries on six continents. With the Milk Income Loss Contract (MILC) expired as of September 30, 2013, and the farm bill in limbo, CWT is the only program actively providing support to America’s dairy farmers.

In membership news, Tillamook County Creamery Association (TCCA), headquartered in Tillamook, Oregon, joined the 37 other cooperatives in supporting CWT’s export assistance effort.

TCCA has approximately 100 member-owners and manufactures a variety of cheeses and other branded dairy products, including: Cheddar, Cheddar Cheese Curds, Monterey Jack, Reduce Fat Monterey Jack, Hot Habanero Jack, Colby, Colby Jack, and Pepper Jack. Other cheese varieties include Swiss, Smoked Swiss and Baby Swiss; Muenster and Provolone. They also manufacture a line of premium ice cream, yogurt, sour cream, butter, whey, and WPC 34 from the two plants that they operate – one in Tillamook and the second in Boardman, Oregon.

The CWT Committee representative from TCCA will be Mark Wustenberg, vice president of quality and operations.

Through its work in the Consortium for Common Food Names (CCFN), NMPF has continued to support efforts to preserve market access for U.S. cheeses in several Latin American countries and continues to monitor the situation globally.

Most recently, FEPALE, the Pan-American Dairy Federation (Federación Panamericana de Lechería), passed a resolution in opposition to the European Union’s (EU) increasing efforts to restrict the use of common food names. FEPALE represents the vast majority of countries throughout the Americas. The resolution was passed by FEPALE’s board during the group’s Annual meeting in Panama City, Panama on November 21.

The EU has been working aggressively within its trade agreements in Latin America and other nations to restrict the use of food names, including such common cheese names as “parmesan,” “asiago,” “gorgonzola” and “feta.”

The resolution notes that the EU’s efforts to lay sole claim to numerous terms in widespread usage globally would have “significant negative impacts on FEPALE members,” and pose a “global threat to trade and commerce.” The original Spanish version can be found here, and a translated copy is available here.

NMPF agrees with CCFN that there is a place for the protection of certain foods from distinct regions, such as Napa Valley wines or Camembert de Normandie cheese from France, but the EU has pushed the bounds of geographical indication protections to include generic names, forcing countries to accept their demands. NMPF will continue its work to combat this threat to U.S. dairy sales.

Members concerned about this issue and interested in getting additional information can contact Shawna Morris at smorris@nmpf.org.

Brenda Rowe (left) recently joined NMPF as Executive Assistant to the President & CEO. As Executive Assistant, she will support NMPF by managing activities related to the President’s office.

Brenda has over 16 years of Executive Assistant experience and over four years of association experience. She worked four years at the Color Pigments Manufacturers Association as Executive Assistant, which covered a variety of roles in meeting planning, office management, accounts receivable, membership services, and assisting the Board and President.

Brenda is married and has a son in college, and currently resides in Alexandria, Virginia. She can be reached at browe@nmpf.org.

Of all the decisions any of us make professionally, the two most important are whether to take a job, and then when to leave it. Sixteen years after deciding to become President and CEO of the National Milk Producers Federation, I’ve chosen to retire at the end of the year…which means this is my last column for NMPF’s CEO Corner. So, all my big decisions have been made.

Rather than offer a recitation of memorable moments (there have been many cherished ones with people in this business) or a list of regrets (as that other singer from New Jersey famously said, I’ve had a few, but too few to mention), allow me to offer a few parting observations about the lessons I learned at NMPF, and how they shaped the past 16 years working for the organization’s members, and the dairy industry.

How you define consensus can give you everything or nothing. The tendency among most organizations, particularly trade associations led by a board of directors, is to define consensus as getting everyone to be in accord on a particular position. But if it’s a tough issue, waiting for 100% alignment can paralyze the organization and neutralize its effectiveness. That was the situation I found when I came to NMPF in 1997. One of the first things I said was that striving for consensus is incredibly necessary, but defining it as a situation where everyone has to be completely happy is a mistake. Hard choices never lead to complete harmony, but as long as people have input into the process and contribute their two cents, an organization then needs to move forward in order to be effective. This belief roiled the membership in my first few years at NMPF, but made my job easier in the long run.

Credibility is your credit. NMPF doesn’t sell products; rather, it offers ideas to our industry and to policymakers. Nevertheless, any marketing effort involves getting people to buy in to the ideas you’re selling. In order to gain traction in the world of ideas, they have to be credible. They must be based on sound science, and the economics have to be clearly understood. To the extent that we’ve had success in the past 16 years, it’s because we have not advocated positions that weren’t defensible and credible. The legislators and regulators we’ve worked with have appreciated that we have grounded our ideas in the facts, not in ideology or mythology. And we have gained greater traction over time, and gotten more credit, because we could back up our ideas with the facts. Making a convincing case – making the sale – the second, third, or 100th time is only possible if you have a reserve of credibility from delivering on your word the first time.

Proactivity uses less energy than reactivity. While there’s some value to the notion that if it ain’t broke, don’t fix it, it’s also true that it’s far easier to change things before they’re completely broken. One thing I did at NMPF is to identify areas where we needed to make changes, to learn and evolve, before we had our collective backs up against the wall. The National Dairy Farmers Assuring Responsible Management (FARM) program is an example of this dynamic. As consumer expectations change, we need to be out in front in developing a national industry standard for dairy cow care. We couldn’t wait until the consuming public thinks there’s a problem, and only then try to fix it. Yes, it’s been hard work, and that work continues. But one look at the challenges of other sectors of agriculture tells us that building a program like FARM will make our jobs as dairy marketers easier in the future.

Doing the right thing is harder in the short term but makes life easier in the long run. As I’ve said so many times in discussions with our members, doing the right thing is often very hard. It’s relatively easy to define the right thing, but much more difficult to push toward it. Again, with trade associations, it can be a chore in pulling the members together to work on controversial positions. But as I noted in my last column, the one discussing our position opposing the greater availability of raw milk, easier paths are usually not the right ones. And all of us, regardless of where we are in our careers, end up regretting the times when we chose the easy path over the right one.

ARLINGTON, VA – A recent analysis by the Congressional Research Service (CRS) of the competing House and Senate farm bills shows that the Senate’s dairy program costs less than the House version, the National Milk Producers Federation (NMPF) said today, helping fortify the case for the Senate‘s dairy title as negotiations continue in the congressional farm bill committee.

The House farm bill’s dairy title is projected to cost $418 million above the baseline, according to the CRS report released in October, while the Senate dairy program costs $302 million more over the next ten years. [These figures are in Tables 4 and 5 of the report, starting on p. 22].

Incoming NMPF President and CEO Jim Mulhern said Tuesday that the CRS report – the first to compare the two competing farm bill versions that conferees are attempting to reconcile – buttresses the point that NMPF has been making about the need to couple margin insurance with a market stabilization program, as the Senate bill does, to achieve cost controls.

“While even this analysis seriously underestimates what we and other independent analysts believe would be the real cost of the badly-flawed House approach, the CRS report demonstrates that the Senate plan is the most fiscally responsible program,” Mulhern said. “Without the market stabilization program to both reduce the duration of low margin conditions, and reduce government outlays for insurance payments, the House plan would be a budget-buster – and one that we urge the conferees to reject, in favor of the Senate’s more prudent approach.”

House Agriculture Committee Chairman Frank Lucas (R-OK) made the same observation last Friday in a radio interview with Ron Hays of the Oklahoma Farm Report (a transcript of which is available here), in which he responded, when asked about the prospects for the dairy title, that “if you don’t have supply management, can you restrain the cost in the rest of the [dairy margin insurance] proposal? Probably not.”

Both the House and Senate farm bill dairy programs replace existing safety net programs with a new margin insurance program. But only the Senate version couples the margin insurance with a market stabilization component that would encourage farmers to temporarily reduce milk production when conditions warrant. NMPF has long contended that this formula makes the program more effective for farmers, and also better protects taxpayers by reducing the government’s costs.

Mulhern also said that the market stabilization element will not adversely impact consumer prices for dairy products, contrary to bogus claims made by those opposing the Senate’s Dairy Security Act.

“If the market stabilization program ever kicked in – and that’s a big if – it would only be when farm milk prices are in the tank. The Senate plan would simply put a floor under the price to keep it from falling further and would not have a noticeable impact on the cost of milk to consumers. Nor would it affect the milk bought through government food assistance programs,” he said. “The purpose of market stabilization is to keep farmers’ milk prices from staying too low, for too long a period. Any suggestion that it will spike retail prices to abnormally high levels is a deceitful and deliberate misinterpretation of the studies done on the impact of the DSA.”

Mulhern was referring to efforts to distort the analysis done by University of Missouri agricultural economist Scott Brown, who has examined the impact of the Senate’s Dairy Security Act versus the processor-backed House plan (which would retain margin insurance but eliminate market stabilization from dairy reform). In Brown’s analysis of the DSA, if it had been in effect from 2009 to 2012, the market stabilization element would have been activated for only four out of 48 months.

Also, the average difference in farm milk prices between the two approaches was only two cents per gallon over four years. “That’s one half of one cent per year, a tiny amount compared with the monthly price swings currently experienced by farmers and hardly a major impact on consumers,” Mulhern said.

 

The National Milk Producers Federation (NMPF), 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.