August 4, 2009
DairyLine Broadcast: Long-term Policy Solutions Needed for U.S. Dairy Industry to Thrive
By Jerry Slominski, IDFA Senior Vice President for Legislative Affairs and Economic Policy
Last month, a Congressional panel held a day-long hearing on the 'state of the U.S. dairy industry.' Due to the intense interest in the issue, two more hearings were conducted over the last two weeks, and law makers quickly focused on the current economic crisis caused by low farm milk prices. Dairy farmers, co-op leaders, federal agriculture officials, dairy companies, economists and lenders all came to testify before the House Agriculture Subcommittee on Dairy, Livestock and Poultry.
IDFA's Chairman Paul Kruse, who is CEO and president of Blue Bell Creameries, was invited by Subcommittee Chairman David Scott of Georgia to testify and spoke on behalf of IDFA's 220 dairy companies. Kruse told the subcommittee that dairy processors are very concerned about how hard this economy has hit dairy farmers. "The partnership between milk producers and milk manufacturers is critical to the overall health of our industry," he said during his testimony.
Kruse then called for developing long-term strategies that will strengthen the dairy industry. He said that providing greater access to risk management tools, expanding international markets, and encouraging innovation in dairy products must be a fundamental part of policy solutions developed to address the industry's cyclical price volatility.
"As an industry, we can capture more opportunities for growth if we avoid the temptation to put more band-aids on an old system and consider long-term approaches that will allow us to innovate and expand," Kruse said.
Several dairy coop and producer witnesses called for a broader approach as well and mentioned the need to simplify and change the current pricing system, to build more demand for dairy products and to allow our industry to compete on the world stage.
It is clear that while a temporary fix may be considered in the near future, a more comprehensive approach is needed or we will be back in the same place in but a few years.
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DairyLine is heard on more than 90 radio stations and IDFA provides listeners with a processor perspective on industry issues during monthly broadcasts.
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