IDFA Says Latest Farm Bill Strategy Will Have “Dramatic Consequences” for Dairy Industry
The latest Democratic strategy to push enactment of a new Farm Bill threatens to double milk prices, which the International Dairy Foods Association said would lead to decreased consumption and a decline in dairy exports. In a proposal to Secretary of Agriculture Tom Vilsack, U.S. Rep. Collin Peterson, D-Minn., of the House Agriculture Committee suggested the agency immediately enforce dairy provisions from the 1949 Agricultural Act, which would double current milk prices from $18 to roughly $38 per 100 pounds if a new Farm Bill isn't passed by the end of 2013. However, IDFA's Senior Vice President of Legislative and Economic Affairs said the association recommended delayed enforcement of the 1949 provisions and allow Congress time to complete action on a new Farm Bill by the end of the year.
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In a July 11 floor speech in opposition to the Federal Agriculture Reform and Risk Management Act, Peterson said “the beauty” of the 1949 laws is that it forces Democrats and Republicans to work together toward a new farm bill “because no one really wants to go back to the old commodity programs.” However, Jerry Slominski, Senior Vice President of Legislative and Economic Affairs at the International Dairy Foods Association (IDFA), disagreed and said the 1949 regulations were “inapplicable” to today’s dairy industry and that “no one should be in a hurry to enforce an “outdated and irresponsible law” that would cause such “irreparable damage” to dairy consumption and exports.
Chris Galen, Senior Vice President of Communications at the National Milk Producers Federation, called Peterson's strategy one of many "Sword[s] of Damocles" hanging over Congress to prompt them to act. Galen said the next three months offered Congress enough time to enact a new farm bill, and that other options were to extend the current bill as Congress did at the end of 2012, or to revert back to 1949 law. He emphasized that if Congress fails to act, "there could be severe consequences." Though Vilsack is fully aware of the strategy's potential consequences, Galen said the Secretary was willing and "prepared to implement it.”
Government interference to artificially raise dairy prices would also “force safety and federal nutrition programs to pay significantly higher costs”, Slominski said. He added that the House of Representatives already voted to reject Peterson’s program to impose production quotas on dairy farmers that would subsequently raise prices, and urged Vilsack to reject this “very similar effort.” Slominski said a similar situation already happened last year when a portion of the 2012 farm bill limited dairy production by farmers enrolled in a market-stabilization program (See Ref:[12042505]).
“The most important thing is that it would potentially hurt the people that Peterson is trying to help, which is the dairy industry,” Slominski said, adding that the strategy was not something that “anyone, even Peterson,” really wants to see happen. “In the off chance that it does, it could have very dramatic consequences.” If the Administration chooses to take immediate action towards the strategy, Slominski said that “it will be responsible for unnecessarily forcing millions of low and middle-income Americans, particularly families with children, to pay higher grocery bills, and for significantly increasing the costs of our nutritional safety net programs at a time when millions are still struggling to make ends meet."