NMPF board approves proposal for dairy policy change

Yesterday, the National Milk Producers federation board of directors approved a recently formulated proposal that will request a major overhaul of U.S. dairy policy. The group's goal is to better protect dairy producers and position them more favorably in an increasingly volatile global marketplace.

The group of concepts is being titled "Foundation for the Future" and according to NMPF CEO Jerry Kozak, the package will be used as the basis for the future direction of the dairy provisions in the next Farm Bill or in some other form of federal legislation that Congress may consider in the future.

“If there is anything good that has come out of the past 18 months of economic struggle, it’s the shared feeling among NMPF’s members that we can use this experience as the catalyst to make needed changes in dairy policy,” said Randy Mooney, NMPF Chairman and dairy farmer from Rogersville, Mo.

NMPF’s plan calls for transitioning the existing safety nets of the Dairy Product Price Support and Milk Income Loss Contract Programs into a new Dairy Producer Margin Protection Program to guard against periods of severe financial pressures; establishing a Dairy Market Stabilization Program to help address periodic imbalances in milk production and demand; and reforming the Federal Milk Marketing Order Program.

The Federation’s proposal to revamp the federal safety net involves creating an insurance program tied to the margin between the national average cost of feed and the national average all‐milk price. After farmers choose to enroll in the base level of the Dairy Producer Margin Protection Program at no cost to them, they would receive indemnity payments during periods when their margins are severely compressed, as they were for most of 2009. In addition, farmers would have the option of purchasing supplemental coverage to protect a higher margin level between feed costs and milk prices.

Kozak said that NMPF will now begin a comprehensive education effort to inform the entire dairy producer community, as well as policymakers, about the merits of Foundation for the Future.

ABC's Nightline makes a direct hit at dairy farmers

Just last night, if you stayed up past your local news and turned on the TV you would have seen a disturbing negative report about the dairy industry on ABC. Before the piece even ran, we were led to believe the piece would be about milk quality, but it was nothing more than an attack on how dairy farmers care for their animals. ABC has posted the story online and has already received 529 comments as of this morning.

Undercover videos were shown of tail docking, as well as dehorning (did you notice the PETA stamp in the corner of the video?). The videos weren't pretty and were undeniably damaging to the dairy industry. You and I may know this is not the status-quo on dairy farms, but, for the average consumer, this may be as close as they ever get to a farm. There needs to be a zero-tolerance for this disappointing animal care shown in the Nightline "investigation."

Tail docking is an unnecessary practice and is not recommended by the American Veterinary Medical Association. To see AVMA's stand on the practice, visit them here. AVMA also suggests disbudding along with a local anesthetic for dehorning — not the practice shown in the undercover video.

Chris Galen of the National Milk Producers Federation (NMPF) was interviewed during the report, as well as the dairy farm owner. While the dairy farm owner relayed his belief that tail docking is a standard practice on dairy farms, we believe it is the contrary. Tail docking is now banned in California; however, prior to its ban, a survey of over 200 California producers (average herd size of 2,500) revealed that 89 percent of dairies did not dock tails. Comments from Chris Galen of NMPF were kept to a minimum — likely because he only had positive things to share about dairy farms.

A representative of the Humane Society of the United States (HSUS) also was interviewed and had the last word when the representative ended the piece with "Got ethics?" as a direct jab at the "Got Milk?" campaign. To answer her question, we say yes. Farms across the country work very hard to produce a safe, and humanely produced product. Let's work together to enforce a zero-tolerance standard for poor animal care.

What did you think of the piece? We'd love to hear your take on it.

CWT accepts 388 bids representing 102,898 cows

Cooperatives Working Together (CWT) announced today that it has tentatively accepted 388 bids representing 102,898 cows and 2 billion pounds of milk production capacity in the first of a series of herd retirements planned over the next 12 months. The number of cows and pounds of milk represent the largest single-herd retirement carried out in the six-year history of CWT.

Dairy farmers in 41 states submitted a total of 538 herd retirement bids by the May 1 deadline. The 388 bids tentatively accepted represent 72 percent of the total bids received by CWT. The number of cows now scheduled to be removed account for 64 percent of the total number of cows offered, and the 2 billion pounds of milk account for 67 percent of the milk production offered. “The high percentage of bids CWT selected this time around is an indication that producers understood that CWT would only be able to accept reasonable bids per hundred pounds of milk in order to adjust the nation’s dairy herd and better align supply and demand,” said Jerry Kozak, President and CEO of the National Milk Producers Federation (NMPF) which administers CWT.

Starting next week, CWT field auditors will begin visiting the 388 farms whose bids were accepted, checking their milk production records, inspecting their herds, and tagging each cow for processing. All farms should be audited by early July, and cows should begin moving off dairies by late May. All bidders will be notified no later than June 12, 2009, as to whether their bid was among those accepted.

“The bids selected ranged from farms with fewer than 50 cows to dairies with over 5,000, demonstrating that farms of all sizes in all areas are facing a very difficult year in 2009,” Kozak said. “Those who took advantage of CWT’s offer to retire their herds will aid others still wanting to farm by reducing the amount of milk coming to market and strengthening prices going forward.”

CWT members support two-year committment

With production costs far exceeding the price dairy farmers are receiving for their milk, the members of Cooperatives Working Together voted Tuesday to fund the self-help program for two full years, from Jan. 2009 through Dec. 2010, to help bring the dairy supply into balance with shrinking demand. “America’s dairy farmers are looking to CWT to help them overcome the dire financial circumstances they are facing,” said Jerry Kozak, President and CEO of NMPF, which manages CWT.

The decision to fund CWT for another two years is predicated on achieving the participation of a 67% supermajority of the nation’s milk supply at the current 10 cent per hundredweight membership assessment, Kozak said.

CWT’s members also approved two changes in program policy. First, all members whose bids are accepted in future herd retirement programs will agree and warrant to cease dairy production for one year. This warranty will apply to both the producer and his/her dairy facility.

The second change is that farmers who were successful participants in past CWT herd retirement rounds will be permitted to bid in the next herd retirement round that CWT conducts.

Kozak also noted that CWT has not solicited government financial assistance. He indicated that a prominent agricultural lender will provide CWT a line of credit tied to the level of funding that CWT members are committing to invest in the organization over the next two years.

CWT accepts 184 bids representing 61,000 cows

Cooperatives Working Together announced today, December 10, that it has tentatively accepted 184 bids in its second herd retirement of 2008, representing 61,078 cows and 1.2 billion pounds of milk. In addition, CWT has accepted bids for 1,548 bred heifers in this herd retirement program.

Together, CWT’s two herd retirements this year account for 85,663 cows that produced 1.637 billion pounds of milk, along with another 2 billion pounds, milk equivalent, that CWT’s Export Assistance program has removed from the market.

Farmers in 40 states submitted a total of 471 herd retirement bids in late November to CWT, reflecting “the continuing financial stress that many farmers are facing as milk prices plunge below the cost of production,” said Jerry Kozak, president and CEO of NMPF, which administers CWT. Kozak noted that, although the costs of dairy feed and diesel fuel have dropped, milk prices have fallen faster.

Starting next week, CWT field auditors will begin visiting the 184 farms whose bids were accepted checking their milk production records, inspecting their herds, and tagging each cow for processing. All farmers will be notified no later than January 12, 2009, as to whether their bid was among those accepted in this sixth herd retirement round that CWT has conducted since 2003.

“In this retirement round, the bids were more competitive and came from larger dairy operations,” he said. “Still, we were careful to expend CWT funds on bids that were commensurate with current overall market prices for cows.”