Bush's Farm Bill Proposal Maintains Dairy Policies

Dairy producers are finding a lot to like in the Bush Administration’s plans for the 2007 Farm Bill. Dairy processors, meanwhile, have a different take. The National Milk Producers Federation was nearly ecstatic when the USDA proposals were revealed.

 “We are greatly encouraged that the USDA will advocate the continuation of the dairy price support program,” said Jerry Kozak, President and CEO of NMPF. “Our organization is still working on its own detailed proposals for the future of the price support program, and it’s heartening to know that we appear to be on the same wavelength as the Agriculture Department when it comes to the need to keep this safety net program.”

The International Dairy Foods Association expressed “deep disappointment” in the administration’s package. IDFA took particular aim at the continuation of the Dairy Price Support Program and the Milk Income Loss Contract (MILC) Program, which it called “a poorly conceived, regionally divisive payment program linked to price and production.”

“The administration’s proposal keeps dairy policies stuck in the 1930s and ‘40s,” said Chip Kunde, IDFA senior v.p. “While boldly suggesting a new, healthier direction for other commodities, the administration’s plan fails to do so for dairy.”

Kunde said he was most disappointed in the administration’s failure to address what he called the current flaws in the Dairy Price Support Program. Kunde maintains the program constitutes 30% of the most trade-distorting expenditures, known as amber box allowances, that the United States reports under global trading rules.

The Bush Administration package puts forth more than 65 new proposals as part of this year’s farm bill, incorporating suggestions received at 52 Farm Bill Forums held around the country.

“We listened closely to producers and stakeholders all across the country and took a reform-minded and fiscally responsible approach to making farm policy more equitable, predictable and protected from challenge,” said Agriculture Secretary Mike Johanns. “We started with the 2002 farm bill and propose to improve it by bolstering support for emerging priorities and focusing on a market-oriented approach.”

The Administration’s 2007 farm bill proposals would spend approximately $10 billion less than the 2002 farm bill spent over the past five years.

J. Mark Huffman is Dairy Foods’ Washington correspondent. Contact him at J. Mark Huffman, ConsumerAffairs.com; 435 Sawmill Cove Drive;  Heathsville, VA 22473; 804/453-9339 .