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Dairy prices will likely rise without farm bill extension
Kentucky Correspondent

FRANKFORT, Ky. — With the expiration of the farm bill on Sept. 30, concerns and speculation about what might happen next came quickly.

Several ag organizations – including the American Farm Bureau Federation, the National Corn Growers Assoc. and the National Milk Producer Federation (NMPF), to name a few – issued a joint statement: “While expiration of farm bill program authorities has little or no effect on some important programs, it has terminated a number of important programs and will very adversely affect many farmers and ranchers, as well as ongoing market development and conservation efforts.”

Those in dairy are already being affected, as some programs changed with the expiration date. In fact, if a bill doesn’t pass by the end of the year, provisions set forth in 1949 permanent law legislation could cause dairy prices to jump extensively.
“Dairy is among the first sectors in agriculture to feel the impact of Congress’ inability to reach accord on most anything, including a new farm bill,” said Jerry Kozak, president and CEO of NMPF. “Had the House leadership brought the bipartisan farm bill to the floor, I believe we could have passed a bill containing the Dairy Security Act (DSA). Instead, we are in uncharted waters, and one of our life rafts has disappeared.”

But the DSA, contained in the pending version of the farm bill, is somewhat controversial as it includes a voluntary supply management program, or Dairy Market Stabilization Program, something supported by NMPF but opposed by other dairy organizations.

Kentucky Dairy Development Council Executive Director Maury Cox said the program as written in the bill might not be good for small producers, and some changes need to be made in that provision of the bill before it becomes law.

“We hope when (lawmakers) come back, they are going to do an extension and re-look at this after the first of the year. We’re not real crazy about the DSA. We think there are some things that we would like to see changed,” he said.

“If they are going to have supply management, it probably should be a mandatory thing. We don’t necessarily agree with the concept of it. We think there will be larger producers who supply the greater quantity of milk, that will not participate and it will put the smaller farmers at a disadvantage, quickly.”

Cox also said he believes Congress will at least pass an extension of the farm bill before any provisions kick in that would raise the price of milk to an exorbitant level.

USDA Secretary Tom Vilsack said, “Many programs and policies of the U.S. Department of Agriculture were authorized under the Food, Conservation and Energy Act of 2008 (farm bill) through September 30, 2012. These include a great number of critical programs impacting millions of Americans, including programs for farm commodity and price support, conservation, research, nutrition, food safety and agricultural trade.”

He also said with the expiration, the agency’s authority or funding to deliver many of these programs expired, leaving USDA with far fewer tools to help strengthen U.S. agriculture and grow a rural economy that supports 1 in 12 American jobs. “Authority and funding for additional programs is set to expire in the coming months. Without action by the House of Representatives on a multi-year Food, Farm and Jobs Bill, rural communities are today being asked to shoulder additional burdens and additional uncertainty in a tough time,” he added.

“As we continue to urge Congress to give USDA more tools to grow the rural economy, USDA will work hard to keep producers and farm families informed regarding those programs which are no longer available to them.”