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IDFA Takes Dairy Reform Message to the Hill IDFA staff members returned to Capitol Hill last week to conduct their second "Briefing on the State of the Dairy Industry," this time for Senate staff interested in dairy and agriculture issues. Echoing comments made to House staff on June 6, IDFA Chief Economist Dr. Bob Yonkers outlined several changes experienced by the dairy industry over the past quarter-century, while IDFA Senior Vice President Chip Kunde discussed the industry's future challenges and opportunities.Yonkers noted that dairy is the only commodity with two government safety net programs today. Reviewing the Dairy Price Support Program, Yonkers pointed out that the U.S. Department of Agriculture (USDA) spent more than $2 billion per year for six straight years in the mid-1980s to purchase dairy products not wanted by the commercial marketplace. "This period was a clear example of the threat to the U.S. budget from setting too high a price support level for farm milk," Yonkers said. In response, Congress acted to lower the price support level from $13.10 per hundredweight to $9.90 to reduce government spending. This action also reduced the market distortions resulting from this program by encouraging the dairy industry to make products needed by the commercial market rather than only for sale to government storage facilities. Touching on global demand, Yonkers said world dairy markets are the strongest they have been in years, and the U.S. dairy industry needs to focus on being competitive in the world market to take advantage of expanding opportunities. "U.S. efforts to increase market access through international trade agreements are increasingly important for the U.S. dairy industry to be able to capture the growing share of world growth in dairy product demand," Yonkers said. Expanding on the industry's future, Kunde reviewed several issues that IDFA members and staff discussed with members of Congress earlier this month during IDFA's Washington Conference. He emphasized that IDFA will continue working with Congress to achieve much needed improvements in dairy programs as legislators consider the 2007 Farm Bill. "The next Farm Bill provides the best opportunity to begin a transition toward a single, national safety net that will not interfere with the market," Kunde said, "but will increase the competitiveness of American dairy goods both domestically and internationally." These briefings build a better base of understanding of industry issues and are made possible through IDFA member support of the Dairy Education Fund (DEF). The DEF provides resources to inform congressional and policy experts about the issues facing the dairy processing industry. Donations can be made through corporate funds. For more information about the DEF or the briefings, contact Kristin Wilcox, kwilcox@idfa.org or (202) 220-3508.
Posted June 26, 2006
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