IDFA Playing Offense and Defense on Farm Bill

by Stephen Barlas
Washington Editor

Dairy marketers will be fighting both offensive and defensive battles in the Senate trying to ward off objectionable changes to the dairy section of the Farm Bill passed by the House at the end of July, and trying to improve that section, too.
The three key issues in play in the Senate, when it finally takes up its bill in late September, will be forward contracting, new import fees on dairy products and expansion of the Milk Income Loss Contract (MILC) program, which is a priority for U.S. Sen. Patrick Leahy (D-Vt.), who one Washington wag calls a “600-pound gorilla” on dairy issues, and who is not someone Senate Ag Committee Chairman Tom Harkin (D-Iowa) can ignore.
Leahy already got language stuck in a 2007 budget bill clearing the way for MILC payments to be substantially increased if final Farm Bill language allows for that. The House bill extends the MILC program to 2012, but it does not expand the MILC payments, which dairy marketers dislike because those payments work at cross purposes with the milk price-support program.
“Senator Leahy will surely get what he wants included in a Senate Ag bill, likely a continuation of MILC and perhaps with some permutations,” acknowledges Connie Tipton, president and chief executive officer of the International Dairy Foods Association. Then a House-Senate conference committee will have to reconcile any differences.
While the IDFA will be fighting against any expansion of the MILC program, it will be fighting for as broad a forward-contracting program as possible. Forward contracting allows proprietary milk processors regulated under the federal milk order program to contract for future deliveries of milk from producers or their cooperative associations at prices exempt from minimum federal milk marketing order blend prices.
The IDFA has been trying to convince Congress to reinstate forward contracting ever since a pilot program ended in December 2004. The draft House Farm Bill did just that, and made forward contracting permanent. But the milk cooperatives — which are allowed to forward contract — fought back.
In the final House bill, forward contracting is allowed over the five-year term of the Farm Bill, and any contracts signed in the last years of that term can run beyond that five-year period. So that is still a big step forward compared to the current situation, but clearly a compromise, and a step backwards from the draft House bill. The House also added a number of “producer safeguards” to that provision, including provisions specifying that contracts must be voluntary and not coercive, and that producers have the ability to ask the USDA to review any undesirable behavior.
Christopher Galen, senior vice president of the National Milk Producers Federation, says his group is fine with the House compromise and says he hopes “there won’t be any further wrangling over this in the Senate.”
The new import fee on dairy product ingredients in the final House bill was authorized by the 2002 Farm Bill, but held in abeyance because the World Trade Organization said it violated its rules. The House attempted to fix that WTO problem in this year’s bill. The IDFA will be trying to convince the Senate to reverse that action, which will be an uphill battle since Harkin also was chairman of the Senate Ag Committee when the fee was first written into the law in 2002.
Stephen Barlas has been a full-time freelance Washington editor for business and trade magazines since 1981.
Compensation Results Now Available from IDFA
Human resource managers working in plants for public dairy foods companies earn cash compensation that averages 20 percent higher than those of their counterparts in private companies. That’s just one example of the compensation data included in the 2007 Industry Compensation Survey report released last month by the Washington, D.C.-based International Dairy Foods Association (IDFA). The survey, conducted and compiled by Salary.com Inc., a leading provider of on-demand compensation management solutions, includes key salary data for 65 job titles, making it the most comprehensive source of compensation data in the dairy foods industry. “Many of the jobs included are unique to the dairy foods industry, so this compensation data will not be found in any other survey,” says Connie Tipton, IDFA president and chief executive officer. “We’re pleased that so many companies recognized the value of participating, because the results represent a wide variety of organizations and geographic regions.” The 2007 IDFA Industry Compensation Survey report presents data reported for 65 job titles, from 55 organizations reporting on 84 locations in the United States. The survey reports pay practices for large and small organizations measured by revenue and by number of full-time employees. The survey reports pay practices by ownership type, both public and private organizations, and includes pay practices within two regions, the Northeast and Midwest. The data is further divided by sub-regions, which include the Mid-Atlantic, Great Lakes and Central Plains. In addition, data for two states, Wisconsin and Pennsylvania, is reported. The cost for the 2007 IDFA Industry Compensation Survey is $195 for participants, $595 for IDFA members that did not participate and $795 for non-members that did not participate. For more information or to order, visit www.idfa.salary.com .
Call for NCI Nominations
The National Cheese Institute (NCI) is now accepting nominations for its highest honor, the NCI Laureate Award. The award winner will be recognized at a special ceremony during the 2008 Dairy Forum, January 20 to 23 in La Quinta, Calif. Nominations are due to NCI by November 2, and there is no entry fee. Candidates should be business or academic leaders who have made significant, prolonged contributions to the development and growth of the cheese industry. The award recipient is chosen by a panel of industry professionals based on a nominee’s overall career achievements. “The success and growth of the U.S. cheese industry is driven by people who dedicate themselves to quality cheesemaking,” says NCI president and chief executive officer Connie Tipton. “With this award, we’re looking to celebrate those individual contributions.” For more information, visit www.idfa.org .