Several months ago we reported and we continue to report that dairy farmers are receiving a milk check that is 40% below 2014's price. Finally, other people have started to use percentage figures, but none of these people are urging any steps to eliminate this financial mess!
Does it have to be this way? Of course not! The solution to me is very clear. The Federal Milk Marketing Improvement Act can correct many of the inequities that are facing dairy farmers today. If this Act had been passed in previous years, then in all essence, the average dairy farmer would not be in the financial crisis they are facing today.
Let's examine many of the reasons why dairy farmers are in their present situation. In 1981, the United States Congress froze the dairy support price at $13.10 per cwt. (hundred-weight) but in a few days it went to $13.60. Since that time, they continued to drop the support price until it reached $9.90 per cwt. (Unbelievable!) Congress also passed legislation that compelled dairy farmers to pay money into the dairy herd termination act as well as the milk diversion program. Later dairy farmers were victimized by the Gramm-Rudman deductions.
Later the US Congress mandated the Federal Milk Marketing Orders be consolidated to the present number. Some of us testified at a milk hearing in Alexandria, VA, urging the new consolidated Order 1 to consider the dairy farmer's cost of production, however, this was done in vain.
What did dairy farmers lose by the consolidation in Milk Orders? Well, they were mandated to have their milk price on a product price formula which included the milk processors to receive a make allowance at the dairy farmers' expense.
What else did dairy farmers lose? They lost the cooperative payment provision that was contained in Order 2, which mandated the Market Administrator to compel the dairy cooperatives to market a producer's milk in the event any producer had lost his market.
Look at what is happening today! Former Order #2 producers also lost farm point pricing, which mandated a dairy farmer had his milk priced at his farm, not at a plant 200 miles away. Dairy farmers also lost the base excess plan that was contained in former Order #4. Improvements could have been made in this plan that would have prevented large corporate farmers from flooding the market.
So what did Congress do to further advance the escalation of many dairy farmers? The current Farm Bill eliminated the milk price support program and eliminated the MILC program. In its place, they passed a very controversial and unethical Margin Insurance Program which does absolutely nothing for dairy farmers to receive a fair price for their milk.
Isn't this a great record for Congress? We haven't even mentioned some of the trade agreements that have injured the American family farm! Also, please remember some of the New York politicians put on a great push to encourage NY dairy farmers to produce more milk for the upcoming yogurt plants. One plant failed; another plant is still in existence using a lot of NY milk but opened a plant in Idaho consequently using less New York milk.
We and other organizations always proclaimed that dairy farmers should not be encouraged to produce more milk for the export market.
Now Mr. Dairy Farmer, do you think the US Congress has been fair to you? Of course not. It's high time that all dairy farmers get behind the Federal Milk Marketing Improvement Act. The Act could play a major role in stabilizing a fair price to all dairy farmers. However, if you as a dairy farmer don't get behind this bill and urge all Senators and House members to support this bill, then the alternative will be more and more of what you are going through today.