Dairy farms counting on security act
Have you ever sold something for $1 that cost you $1.40 to make?
In August 2009, dairy farmers across the country did just that.
But they didn’t just sell one gallon of milk at a 40-cent loss. They sold more than 125 million gallons for an estimated $50 million loss. As a result, balance sheets were devastated. Some lost their farms.
All of this resulted from the worldwide recession, something that affected nearly every U.S. citizen in one way or another. Dairy farmers saw their customers around the world stop buying their products because of the economic uncertainty. It couldn’t have happened at a worse time, as feed prices – the biggest input into every glass of milk – soared as milk prices plummeted.
The market has recovered some since then, but we fear another 2009 is just around the corner. That’s why we are asking the House of Representatives to pass a farm bill, including the Dairy Security Act, before the end of September, when the current farm bill expires.
The advantages of the Dairy Security Act include:
• Reducing federal spending compared with the current dairy program by more than $100 million over five years.
• Eliminating two outdated government dairy support programs, without materially affecting the price of milk to consumers.
• Establishing a risk management program that works like an insurance policy, when milk prices and costs of production are out of whack.
• Sending an immediate, but temporary, signal to dairy farmers to produce less when milk is in oversupply. This will limit the future need for the insurance policy.
In June, the Senate approved the Dairy Security Act as part of its farm bill on a strong vote of 64-35. Now, it’s time for the House to act.
The House Agriculture Committee is scheduled to take up the farm bill in mid-July. That can’t happen soon enough from our perspective.
Our hope is that the House completes work on the farm bill before its August recess, leaving time for a House-Senate conference to produce a final bill in September.
Dairy farmers across Washington state and around the country are counting on Congress to act.