Dairy Section Termed ‘Crucial'

July 30, 2001

The House Agriculture Committee's approval of several policy items was termed "crucial" by the National Milk Producers Federation. The key element, in NMPF's estimation, was extension of the dairy price support program through 2011 at the current price level of $9.90 per hundredweight.

That was "a significant victory for America's dairy farmers, who will be able to take comfort in knowing that a modest safety net is in place to prevent the catastrophic collapse of their prices," said Jerry Kozak, Chief Executive Officer of NMPF.

The farm bill also extends the authorization for the Dairy Export Incentive Program (DEIP) through 2011, at the maximum level allowed under U.S. world trade commitments. The DEIP program is needed "to help U.S. farmers compete against heavily-subsidized competition from other dairy-exporting nations," Kozak said.

Another victory for U.S. dairy farmers was the inclusion of language in applying the mandatory dairy promotion assessment to imported dairy products. Importers of dairy items will have to pay the equivalent of 15 cents per hundredweight on the products they bring into this country. The importers will be given up to two seats on the National Dairy Board to supervise the workings of the checkoff program.

"For too long, U.S. dairy farmers alone have had to shoulder the cost of the dairy checkoff program, even though foreign products also benefit from the positive marketing climate created by generic dairy promotion efforts in this country," Kozak said. "Dairy is the only major U.S. checkoff program that does not require importers to pay their fair share. I'm glad we'll rectify that oversight with the next farm bill."

The bill also contains language to correct a technical omission hampering USDA efforts to oversee the mandatory reporting of price and inventory data from dairy processors. The technical correction language will amend an NMPF-supported bill, passed by Congress in 2000, designed to improve the quality of dairy price and inventory information available to the industry.

Also, the research title authorizes a new Johne's disease control program through which the USDA will work with state veterinarians to conduct research, testing and evaluation of programs to control Johne's disease. This amendment, offered by Rep. Ron Kind (D-WI), "takes a big step toward improving the biosecurity of the cattle industry, and will greatly improve our ability to manage Johne's disease," Kozak said.

Another of NMPF's priority items included is reauthorization of the Environmental Quality Incentives Program (EQIP) through 2011 at $1.2 billion annually. The EQIP authorization also removes the size restrictions on the eligibility limitations for livestock producers who may participate in the program.

However, the bill does not include a supplemental payment program for Class III and IV milk, as previously requested by NMPF, nor does it address another NMPF priority: the imposition of tariffs on imports of milk protein concentrate and casein. The committee does not have jurisdiction over trade issues such as import tariffs.