IDFA approves dairy policy reform, opposes supply management plan
June 11, 2010
By Connie Tipton, president and CEO of the International Dairy Foods Association, Washington, D.C.
"On behalf of the members of the International Dairy Foods Association, I commend the board of directors of the National Milk Producers Federation for its commitment to long-term dairy policy change as outlined in its 'Foundation for the Future' plan approved yesterday. Many of the elements of the plan are forward-looking and recognize the need to change existing dairy policies.
We applaud NMPF's support for a margin insurance program. Replacing outdated safety net programs for dairy producers, like price supports, with a program that will help our producers have a more reliable income makes a lot of sense. The health of the U.S. dairy industry depends on the financial viability of our milk producers and processors. This margin insurance program, coupled with new risk management tools to better manage price swings, will go a long way to allow the U.S. dairy industry to remain competitive, both with dairy ingredients in the domestic market and the growing world dairy trade.
IDFA is pleased to see that the NMPF plan calls for the elimination to make allowances and simplification of federal order milk price regulations. IDFA looks forward to working with NMPF on how to make this program work better for everyone.
Unfortunately, not all of the elements of the plan are forward-looking. The plan's Dairy Market Stabilization Program, which is intended to increase prices and limit growth, will have dire consequences for our industry and consumers. Supply management will decrease demand for dairy products and dairy ingredients, and will drive low-cost non-dairy substitutions in foods and restaurants across the country. Supply management will limit industry growth at a time when demand for U.S. dairy exports is growing, and we have a unique opportunity to innovate and expand to serve global markets.
As an industry we are much more effective when we work together, and IDFA is pleased that there are many areas where we can work together with NMPF in this plan. We look forward to continued collaboration that will eliminate the programs that prevent our markets from working, provide a better safety net for producers and make sure everyone in the milk market has the risk management tools needed to manage price volatility.”