By MEGGIE I. FOSTER
Assistant Editor WASHINGTON, D.C. — On Jan. 25, a group of five dairy farmers representing a grassroots voice in agriculture known as the Dairy Policy Action Coalition (DPAC) converged onto Capitol Hill hoping to inspire change in dairy policy with leadership of the House Committee on Agriculture.
According to Dave Forgey, a DPAC board member and dairy producer from Logansport, Ind., most dairy policies that exist today were developed in the 1930s and 1940s, when a “program was set up thinking we’d always have a milk supply, we’d have government storage and a price-support system.
“The challenge with that is that we can’t stop milk production, we can’t just stop cows from producing,” he explained. “We have a surplus, yet we’re not marketing our products globally and we’re missing out.”
Forgey and members of the Dairy Policy Action Coalition (DPAC) believe that the dairy pricing system desperately needs reworked and rewritten, “the milk pricing system is broken and the continual process of patching and re-patching is no longer a satisfactory solution for dairy producers.
“Current pricing policies date back to the time when global marketing was not an issue,” said Forgey. “We need a two-class system, not a four-class system. No other U.S. agricultural commodity still has these constraints when dealing with global markets. As a result, the U.S. lags behind other nations when it comes to making – and marketing – the products that foreign and domestic buyers want.”
According to DPAC vice chair Rob Barley, of Star Rock Farmers in Conestoga, Pa. “until we have fundamental change in price discovery, we’re not interested in a centralized government-run supply management plan. As producers, we don’t want to add another layer of government control within a system that is not working. We want to peel back the layers, not put more layers onto it.”
While in Washington D.C., Forgey and Barley alongside fellow dairy producers and DPAC members Joe Borgerding, of Belgrade, Minn. Daniel Brandt, Annville, Pa.; and Dr. Ben Shelton, of Olin, N.C. met and discussed DPAC’s Cornerstones for Change: A preliminary report about U.S. dairy policy and the global realities of the 21st century with House Livestock, Dairy and Poultry Subcommittee Chairman Tom Rooney (R-Fla.) and John Goldberg, senior professional staff member of the House Committee on Agriculture and dairy expert for the Committee’s Chairman Frank Lucas (R-Okla.)
According to Goldberg, members of the House Committee on Agriculture are “keeping their minds and doors open,” to change, as well as entertaining different proposals as the dairy industry strives to form a consensus on dairy policy.
“I’m hearing good things about dairy,” said Rooney during the meeting. “If we are anywhere close to having consensus, we should seize on the opportunity.”
One other proposal currently being reviewed in Washington D.C. is the National Milk Producers’ Federation’s Foundation for the Future.
While NMPF also represents dairy processors and co-ops, Foundation for the Future is a package of proposed dairy policy programs that “dramatically improves the traditional approach to dairy policy and fosters a more economically-viable and secure future for dairy producers.”
“NMPF’s Foundation for the Future is about margins and tools to help farmers protect against the kinds of margin-derived economic losses they suffered last year,” wrote Jerry Kozak in his December 2010 report. “Importantly, Foundation for the Future also features a Dairy Market Stablization program, which is a producer-funded mechanism to help send unmistakable signals that the market needs less milk.”
According to Kozak, the need for this type of a periodic brake on milk production became evident in 2009 at a time when margins were catastrophically bad for farmers.
“You could certainly argue that if Cooperatives Working Together hadn’t removed nearly 250,000 cows in 2009, milk production wouldn’t have slowed at all and margin depression would have been an even larger crater,” he added.
Forgey said that we already have a margin protection tool that’s available to dairy farmers in the LGM Dairy program; but, for those tools to work, “we need a functioning market and good price discovery.”
While the national margin insurance plan, contained in NMPF’s Foundation for the Future, is viewed as size-neutral and scalable so the government can level it up or down based on funds available, DPAC pointed out that such insurance should not be viewed as a solution to the pricing and marketing issues that have “severely eroded the farmer’s share of dairy value in the marketplace.”
DPAC stressed to House leaders that milk marketing is global, national, and regional; so a national one-size-fits-all answer to supply and demand imbalances, would create new issues, and still not solve the core problems.
“This notion of repairing the system is not enough. Our milk pricing system is broken. We now have the ability to move milk anywhere in the country. We need a system that is designed for the 21st century,” said DPAC ad hoc member Joe Borgerding.
DPAC is a coalition of grassroots dairy producers actively participating, with a unified voice, in the policies and issues affecting the often complex system of federal milk pricing. Formed in November 2009, the board is made up of active dairy producers of all sizes from across the United States.
For more information on DPAC’s Cornerstones for Change and recommendations for change in dairy policy, representative of nearly 500 Americans dairy farmers, visit www.dpac.net or call 800-422-8335.
To read additional details on NMPF’s Foundation for the Future proposal, visit www.nmpf.org |
