Farm Bill Offers Producers Relief

USDA has taken a number of actions recently under the 2002 Farm Bill that affect the dairy industry. Among them, the creation of a new safety net program for dairy producers, the Milk Income Loss Contract, which compensates producers when milk prices fall below a Congressionally specified level. Since the program's launch in mid-2002, USDA has issued more than $700 million under the program and expects the total during FY 2003 to exceed $2 billion. MILC payments occur in months when the price of Class I milk in Boston under the Northeast Milk Marketing Order falls below $16.94 per cwt. The payment rate is 45% of the difference between $16.94 and the Boston Class I price for that month.

Wisconsin Cheese Suit Over

Wisconsin dairy farmers who brought action against several cheese manufacturers have reached the end of their litigation options. The U.S. Supreme Court let stand April's decision by the Wisconsin Supreme Court which ruled the farmers could not sue for damages. The case stems more than ten years, when the dairy producers charged the companies with manipulating prices at the National Cheese Exchange. The producers' case failed to gain traction as the courts held that federal case law prevents suits for damages when the rates in question were lawfully established by a federal agency through formal rulemaking. Milk prices for making cheese were tied to USDA milk marketing rules.

US Defeats Canadian Export Rule

The World Trade Organization (WTO) last month reached a final verdict that vindicates the U.S. challenge to Canada's dairy export practices. The ruling allows the U.S. dairy industry to finally close this long-running dispute, and better defines export subsidies under the WTO rules.