Milk Producers Want Higher Milk Prices

February 14, 2000

The National Milk Producers Federation has asked USDA to adjust the pricing mechanisms of the milk price support program to put more money into farmers’ pockets "at a time when they need it most." NMPF specifically asked that the make allowance be adjusted upward.

USDA should adjust the make allowance so that the price support program make allowance is consistent with the make allowance that processors receive for products made and sold under the federal milk marketing order program, NMPF said in a letter to Agriculture Secretary Dan Glickman.

Currently the make allowance for cheese under the federal program is $0.17 per pound while under the price support program the make allowance is $0.137 per pound. A similar disparity exists between the federal order make allowance for butter and dry milk products and the price support program butter-powder make allowance, says NMPF.

"Equalizing the make allowances in this manner will the increase minimum price safety net that dairy farmers receive under the price support program," said Jerry Kozak, NMPF CEO. "Given that both nonfat dry milk and cheese are hovering right at the price support level, anything we can do to boost dairy product prices will help raise the farm-level prices that currently are painfully low."

The NMPF letter told Glickman that he is "fully empowered to do this now when it would count the most." Dairy farm prices are at a 21-year low and expected to be at those levels at least until summer, says NMPF.