This week David Hickey joined the NMPF staff as the Director of Government Relations.

David was previously with the National Association of State Departments of Agriculture (NASDA) as Manager of Legislative and Regulatory Affairs. His portfolio includes dairy, energy, climate change, rural development, farm safety net, crop insurance, and disaster assistance. He was actively engaged in the drafting and reporting of legislation during the 2008 Farm Bill and Energy Acts.

Prior to working at NASDA, David was a Legislative Correspondent for Sen. Norm Coleman (R-MN) from May 2006 – Jan. 2009.

Originally from Minnesota, David holds a degree in Political Science from Arizona State University. He can be reached at dhickey@nmpf.org.

Cooperatives Working Together (CWT) reactivated its Export Assistance program to boost sales of U.S.-made cheddar cheese. Block cheese prices have risen by 25 cents per pound since the announcement on March 18.

Last used in 2008, CWT's Export Assistance Program assists member cooperatives with exporting eligible dairy products and establishing overseas markets for their members' milk. While the program had, in the past, exported whole milk powder, butter, and butterfat, the focus in the short-term was on cheddar cheese, as this would have the most impact on farm-level milk prices.

“After conducting a thorough economic analysis, it was clear that implementing the Export Assistance program and focusing on cheddar cheese could provide the most immediate positive signal to address continuing low producer milk prices,” said Jerry Kozak, President and CEO of NMPF, which manages CWT. “Given the smaller spread between U.S. and global cheese prices, and given the sizeable inventories of cheese that are hampering a recovery in milk prices, using CWT’s export program will be expedient and effective.”

While the program had previously exported 186 million pounds of dairy products to 55 countries, CWT advised its members that it would provide additional incentives for sales to the target markets of Japan, Algeria, Egypt, Saudi Arabia, and Australia. CWT believed these were prime markets for sales of significant quantities of cheddar cheese, although it would consider bids for sales to other markets as well.

Cooperatives seeking assistance submit a bid specifying the product to be exported, the quantity of product, the end customer, the country in which the customer is located, and the amount of assistance per metric ton of product needed to make the sale. CWT and U.S. Dairy Export Council (USDEC) staffs evaluate each bid received against world market conditions and the world product prices. If they determine that the assistance requested is reasonable, the bid is accepted. The cooperative does not receive payment from CWT until paperwork is submitted showing that the product has been delivered to the customer.

NMPF’s major restricting of dairy policy, entitled Foundation for the Future, continues to develop momentum. The three subcommittees that are fleshing out details of the various programs – producer income insurance, production management, and Federal Order reform – have met repeatedly over the winter, and will continue to finalize details of their respective proposals.

The NMPF Board of Directors received a status update on the Foundation effort at its meeting last month, and directed the association’s staff to finalize the package in time for the next Board meeting in June.

The concepts behind the Foundation for the Future have been presented at several dairy conferences recently, including the Western United Dairymen annual meeting, the 2010 Wisconsin Dairy Policy conference, and the Dairy Farmers of America convention. In addition, Pennsylvania dairy farmer Lauren Mosemann will present a summary of the program at a House Agriculture Committee hearing April 20th in Harrisburg, PA.

On March 11, NMPF testified in favor of a recently introduced House bill that would foster additional U.S. agricultural exports to Cuba, and permit open travel for all Americans to that nation.

NMPF Board member John Wilson (in the photo), who is Sr. Vice President of Marketing & Industry Affairs for Dairy Farmers of America, urged support for the Travel Restriction Reform and Export Enhancement Act (H.R. 4645). The legislation is being championed by House Agriculture Committee Chairman Collin Peterson and Representative Jerry Moran of Kansas. The legislation presently has 37 additional co-sponsors supporting it.

“NMPF believes that efforts to help regain the exports we lost last year are essential to helping farmers and putting the U.S. dairy industry on a firmer footing going forward,” said Wilson. “H.R. 4645 represents one such positive step in the right direction to increase demand for U.S. dairy products.”

The bill would establish clarity and predictability regarding the “cash-in-advance” provision of the Trade Sanctions Reform and Export Enhancement Act (TSREEA) by ensuring its interpretation according to the original intent of Congress to allow for payment in a manner that did not impede trade, while also not offering the extension of credit to Cuba. Prior interpretations of this provision have hampered U.S. dairy exporters’ ability to ship product to Cuba in a safe and cost-efficient manner, Wilson said.

The legislation would also remove a costly and unnecessary burden on U.S. agricultural exporters by allowing payment to pass from Cuba directly to U.S. banks in place of the current, more costly requirement that payments be routed through banks in other countries.

In closing, said Wilson, “We look forward to enjoying the impact this legislation would have on our ability to more easily provide the Cuban people and those Americans wishing to travel to Cuba with the nutritious and safe foods that we produce in such abundance here in the United States.”

NMPF, along with other representatives across the dairy industry, met last week with USDA and the U.S. Trade Representative (USTR) regarding the new EU export certification requirements that take effect October 1, 2010. These new requirements change the 400,000 somatic cell count requirement from sampling at the processor-level (co-mingled milk), to individual farms. Details related to these requirements were provided to members last week.

Moving forward, NMPF will work with the U.S. Dairy Export Council (USDEC) to present USDA with a reasonable and workable interpretation of what would satisfy compliance with the new EU regulations, and allow USDA to continue issuing certificates. NMPF will also be coordinating with the International Dairy Foods Association (IDFA) and the American Dairy Products Institute (ADPI) throughout that process. Additionally, we will continue to work with USTR as they initiate a dialogue with the EU regarding the WTO compliance of this requirement.

Interested students have two weeks left to submit applications for the National Dairy Leadership Scholarship Program.

Each year, NMPF awards four to five scholarships to outstanding graduate students (enrolled in Masters or Ph.D. programs) who are actively pursuing dairy-related fields of research that are of immediate interest to NMPF member cooperatives. Graduate students pursuing research of direct benefit to milk marketing cooperatives and dairy producers are encouraged to submit an application (applicants do not need to be members of NMPF to qualify). The top scholarship applicant will be awarded the Hintz Memorial Scholarship, which was created in 2005 in honor of the late Cass-Clay Creamery Board Chairman Murray Hintz, who was instrumental in establishing NMPF's scholarship program.

Recommended fields of study include but are not limited to agriculture communications and journalism, animal health, economics, environmental science, food safety, genetics, herd management, marketing and price analysis, nutrition, and product development. Applications are due no later than Monday, April 26, 2010. For an application or more information, please visit the NMPF website or call the NMPF office at 703-243-6111.

The 2010 Annual Conference of the American Dairy Products Institute (ADPI) and the American Butter Institute (ABI) is just three weeks away. Record attendance is projected for this year’s conference, which will be held in Chicago, Illinois, from April 25–27 at the Hyatt Regency Chicago.

The 2010 Conference will feature two full days of outstanding speakers and informative programs on current industry topics. There will also be abundant opportunities to network with over 750 senior level executives from manufacturers, marketers, suppliers, distributors, and brokers of manufactured dairy products. Other registered attendees will include industry analysts, journalists, key government officials, and trade exhibitors.

Information about the 2010 Conference is available at the official conference website, www.adpi.org, which includes online registration and exhibitor registration forms. Additional details may also be obtained by contacting ABI (www.butterinstitute.org) at 703-243-5630 or by email at AMiner@nmpf.org. The current agenda for the 2010 ADPI/ABI conference is also available on the website.

“The ABI and ADPI meeting remains a crucial opportunity for dairy industry leaders to discuss where the industry is going in the future, and that need is all the more urgent in today’s changing global and business climate,” said Jerry Kozak, Executive Director of ABI.

The U.S. Department of Agriculture issued its final decision Friday to limit the unfair pricing exemption enjoyed by large, vertically-integrated farmer-owned bottling plants, which according to NMPF will close the loophole for the largest “producer-handler” milk bottlers.

Under rule changes to be published this week in the Federal Register, the producer-handler definitions in all Federal Milk Marketing Orders will be amended so that only farms with bottled milk sales of three million pounds or less per month remain exempt from the pooling provisions. Producer-handlers with sales more than that will be treated the same as other bottling operations that don’t own farms, and will have to pay Class I differentials into the shared producer revenue pool effective in their respective Federal Order regions.

“This decision by USDA is the culmination of years of work by National Milk and our members to create a level playing field for milk bottlers, which ultimately benefits dairy farmers of all sizes,” said Jerry Kozak, President and CEO of NMPF. “The USDA has acknowledged that it’s time to close a loophole that was really intended to benefit small producer-handlers, not those as big as any other commercial milk bottling plant.”

Under the previous rules, a milk bottler of any size could avoid paying into the Federal Order pool in its market so long as it only bottles milk it produces. This regulatory exemption provided a large competitive pricing advantage, and reduced average pay prices for other producers who lost out on shared Class I revenue. Those producer-handlers with bottled milk sales of three million pounds or less per month remain exempt from the pooling and pricing provisions.

The new decision also tightens the requirements in the Arizona and Pacific Northwest Federal Order markets, which had allowed producer-handlers up to three million pounds of sales in separate marketing orders; the new rules allow up to three million pounds in total marketings.

The USDA website has extensive information on the issue. USDA’s decision supports NMPF’s position and frequently cites NMPF’s testimony in its conclusions.

The charge of the Cooperatives Working Together (CWT) Subcommittee that is part of the overall NMPF Strategic Planning effort has been expanded to include a thorough review of supply-demand approaches, as well as an examination of ways to expand CWT’s programs. Because of this change, the name of the CWT Subcommittee has been changed to Production Management Subcommittee.

NMPF member representatives whose board of directors have endorsed a supply management approach will be given the opportunity to present those ideas to the subcommittee, and respond to questions from subcommittee members and staff. Following the presentations, the subcommittee will develop pros and cons for each approach presented, and will make a recommendation to NMPF’s Strategic Planning Task Force regarding each presentation.

On February 5, USDA announced a new, flexible framework for animal disease traceability in the United States. The framework will provide the basic tenets of an improved animal disease traceability capability for the country. USDA’s efforts will:

• Only apply to animals moved in interstate commerce;
• Be administered by the States and Tribal Nations to provide more flexibility;
• Encourage the use of lower-cost technology; and
• Be implemented transparently through federal regulations and the full rulemaking process.

NMPF continues to favor a mandatory animal identification system, national in scope, and one that allows 48-hour traceability across the food chain. While the recent USDA announcement recognizes the political struggle of attempting to create a national system, NMPF said in a statement that “we remain concerned about the potential incompatibility of 50 varying state systems, particularly if some don’t rely on currently available technology, such as RFID tags. Moving forward, we will work with the USDA to ensure the dairy industry is at the animal ID forefront as a collective insurance policy in the event of an animal disease emergency.”

On February 23, livestock and poultry groups hosted educational briefings on Capitol Hill to share the facts about the importance of tools like antibiotics in raising healthy food animals. The informational sessions were co-hosted by NMPF, the National Cattlemen’s Beef Association through beef checkoff funding, the National Chicken Council, National Pork Producers Council, National Turkey Federation, American Meat Institute, and National Meat Association.

The briefings were held in cooperation with U.S. Reps. David Scott (D-GA), Randy Neugebauer (R-TX), Zack Space (D-OH), and Roy Blunt (R-MO) and by Sen. Tom Harkin (D-IA). Top livestock and poultry health experts from across the country presented information to attendees, including dairy producer and NMPF Animal Health Committee member Dr. Leon Weaver of Montpelier, OH (at left in the photo).

Weaver, who is also a veterinarian, told the congressional staff that “The U.S. dairy industry conducts more than 3.3 million tests each year on all milk entering dairy plants to ensure that antibiotics are kept out of the milk supply. According to the most recent U.S. Food and Drug Administration (FDA) data, less than one tanker in 3,800 tests positive for any animal drug residues, including antibiotics. In those rare cases, any milk that tests positive is disposed of immediately and does not get into the food supply.

Dr. Guy Loneragan, an epidemiologist and associate professor at West Texas A&M University and expert on beef cattle, said that “Prompt and judicious use of efficacious antibiotics is critical for the successful treatment and, at times, control of specific bacterial diseases in cattle. Certain FDA-approved antibiotics also enable us to significantly improve the efficiency of beef production.”

NMPF will be testifying at the International Trade Commission’s hearing today on the estimated economic impact of the Trans-Pacific Partnership (TPP) FTA. NMPF’s comments will focus predominantly on the severe harm that would result on US dairy producers if U.S.-New Zealand dairy trade were to be expanded as part of the TPP. NMPF is preparing a statement template on the TPP FTA for coops to use to submit comments to the ITC following the hearing if they wish.

In concert with this effort, NMPF is working to seek Senators’ signatures on a letter regarding the harm that would befall the US dairy industry with expanded U.S.-New Zealand dairy trade in the TPP. We are urging all producers and coops to contact their Senators to make their concerns known about this agreement and to urge Senators to express concern about this issue to USTR.