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Peterson’s dairy bill would replace Margin Protection


WASHINGTON, D.C. — Congress recently made changes to a dairy risk management program to help dairy farmers in this difficult economic environment; however, last week Rep. Collin Peterson (D-Minn.) introduced U.S. House legislation that would start a whole new program for dairy and throw out the old one just amended.

The legislation in question, the Dairy Risk Management Act (House Resolution 5462), would do away with the Margin Protection Program (MPP).

“After spending the last two weeks in Minnesota and participating in a dairy forum in Albany, I wanted to formalize the approach I’m hoping to take as the farm bill moves forward,” Peterson said April 12. “Dairy farmers in my district and across the country are facing tough times that show no signs of letting up. They need a safety net that will help them better manage difficult market conditions now and into the future.”

He said the new program would address the shortcomings of the MPP and has provisions he believes should have been included in the latest budget bill; in short, a stronger safety net for farmers. Dairy farmers are projected to have their net cash incomes decline by nearly 20 percent between 2017 and 2018, according to USDA projections.

H.R. 5462 would reduce the cost of $8 coverage for the first 5 million pounds of all producers’ covered production to just 9 cents per cwt.; more accurately reflect actual producer margins by establishing coverage options at both $8.50 and $9 for the first 5 million pounds of all producers’ covered production; give producers more flexibility by allowing them to enroll up to 90 percent of their production for buy-up coverage; and other provisions.

Peterson introduced H.R. 5462 on April 11. A day later, the House Agriculture Committee unveiled its proposed text of the 2018 farm bill. Although right now H.R. 5462 is a standalone bill, it’s structured to amend the 2014 farm bill, with the current MPP also a part of that farm bill.

The International Dairy Foods Assoc. (IDFA) applauded Peterson’s effort to improve the safety net for dairy farmers and sounded an optimistic note about the proposed farm bill.

“IDFA worked closely with colleagues at the National Milk Producers Federation (NMPF) to unite behind shared solutions for dairy that are reflected in (House Ag) Chairman (Michael) Conaway’s farm bill,” said IDFA President and CEO Michael Dykes.

“We commend House Agriculture Committee Ranking Member Collin Peterson for introducing legislation this week that would allow dairy producers, cooperatives and processors to better manage the price risk for milk. Congressman Peterson also has worked to help the dairy industry, and his bill demonstrates solid support for the shared solutions offered by IDFA and NMPF.”

The NMPF issued its own statement April 12, saying that changes made to the MPP earlier this year were helpful, but more needs to be done. The NMPF has worked with Peterson and others in Congress to make improvements to the MPP and enhance dairy farmers’ ability to use other risk management tools, said NMPF CEO and President Jim Mulhern.