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Call For Change
Dairy leaders propose amendments to the 2007 Farm Bill.
Dairy processors and producers called for changes to current national dairy policies last month during the first dairy-specific congressional field forum on the 2007 Farm Bill. Representative Gil Gutknecht (R-Minn.), chairman of the U.S. House of Representatives subcommittee with oversight for dairy, called for the review of the state of the upper Midwest dairy industry.
Also testifying at the forum were officials from the
U.S. Department of Agriculture (USDA), a dairy economist, Minnesota and
Wisconsin dairy producers and dairy cooperative representatives. More than
90 people attended the forum, which was held at Winona State University in
Winona, Minn.
“This forum showed that the time has come for
dairy policies to get in step with markets,” says Connie Tipton, IDFA
president and chief executive officer. “We are grateful to
Representative Gutknecht for hosting this inclusive discussion as the first
step to modernizing U.S. dairy policies.”
Gutknecht noted the dramatic changes that have
occurred in the dairy industry in recent years. “It can no longer be
looked at from a regional perspective or even a domestic one,”
Gutknecht said.
IDFA chairman Jim Green, president and chief executive
officer of Kemps LLC, the Minnesota-based unit of HP Hood, urged the
committee to strip away outdated farm policies that include two
countervailing subsidy programs and replace them with a progressive plan
that would promote industry innovation and growth. These points were also
stressed during processors’ visits to legislators during the recent
IDFA Washington Conference.
Also testifying at the Farm Bill forum was Mark Davis,
chief executive officer of LeSueur, Minn.-based Davisco Foods International
Inc. and a board member of the National Cheese Institute. Davis stressed
the need for more tools to better manage market fluctuations and urged the
committee to bring back and make permanent forward contracting for
proprietary processors.
Gordon Crow, director of government and community
affairs for The Schwan Food Co., Marshall, Minn., encouraged the committee
to avoid policy obstacles, such as assessments or tariffs on imported dairy
proteins, that would hinder the industry’s global market position.
Lloyd Day, administrator of USDA’s Agricultural
Marketing Service (AMS), cited the strength of the U.S. dairy industry.
“The demand for milk continues to be strong domestically and for
exports of skim milk powders,” Day said, offering a healthy industry
forecast. “Milk production continues to increase in response to near
record milk prices in 2004 and 2005. Milk production is forecast to be up
nearly 3 percent in 2006, following a 3.3 percent increase in
2005.”
The committee also heard from upper Midwest producers
who gave a mixed review of current dairy policy. While some urged Congress
to maintain the Milk Income Loss Contract (MILC) program, others criticized
the current programs as ineffective.
Bob Cropp, professor emeritus at the University of
Wisconsin, questioned the effectiveness of MILC and the Dairy Price Support
Program (DPSP).
“Some type of counter-cyclical program can be
effective in providing dairy farmers with an appropriate safety net and at
a reasonable federal budget exposure level,” he said.
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